Depreciation method of fixed assets

What are the depreciation methods of fixed assets?

The depreciation methods of fixed assets mainly include the following:

1. Straight-line method: The straight-line method is the simplest depreciation method, which assumes that fixed assets will be evenly worn during use, so the value of fixed assets will be evenly distributed according to the use time. This method is suitable for those fixed assets that have been used for a long time and whose value can be fully reflected within the effective use period.

2. workload method: the workload method is a method to calculate depreciation according to the actual workload of fixed assets. This method is suitable for those fixed assets whose use time is short and their value is proportional to the use time.

3. Double declining balance method: Double declining balance method is a method to accelerate depreciation. It assumes that fixed assets wear out quickly at the initial stage of use, so the depreciation amount of fixed assets is apportioned in proportion to the square of the service time. This method is suitable for those fixed assets with short service life and whose value can be fully reflected within the effective service life.

4. Sum-of-years method: Sum-of-years method is also an accelerated depreciation method, which calculates the depreciation amount according to the ratio of effective service life to remaining service life of fixed assets. This method is suitable for those fixed assets with long service life and whose value can be fully reflected within the effective service life.

to sum up, different fixed assets need to choose appropriate depreciation methods according to their characteristics and usage.

Legal basis:

Article 32 of the Enterprise Income Tax Law of the People's Republic of China clearly stipulates: "If the fixed assets of an enterprise really need accelerated depreciation due to technological progress or other reasons, the depreciation period can be shortened or accelerated depreciation can be adopted." At the same time, Article 99 of the Regulations for the Implementation of the Enterprise Income Tax Law of the People's Republic of China further clarifies: "For fixed assets with rapid technological progress or in a state of strong vibration and high corrosion, the depreciation period can be shortened and accelerated."