BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -You can’t depreciate assets that don’t lose their value over time – or that you’re not currently making use of to produce income. These include: Land. Collectibles like art, coins, or memorabilia.

Detailed explanation-2: -Land can never be depreciated. Since land cannot be depreciated, you need to allocate the original purchase price between land and building. You can use the property tax assessor’s values to compute a ratio of the value of the land to the building.

Detailed explanation-3: -The land asset is not depreciated, because it is considered to have an infinite useful life. This makes land unique among all asset types; it is the only one for which depreciation is prohibited.

Detailed explanation-4: -Land has an unlimited useful life and, therefore, is not depreciated. Buildings have a limited useful life and, therefore, are depreciable assets.

Detailed explanation-5: -Land, although a fixed asset is never depreciable. It has an unlimited useful life and therefore can not be depreciated. Depreciation is allocation of cost of fixed asset over its useful life. Value of land can not be reduced to zero and it can not be allocated over its useful life.