IFA54 – Straight-Line Depreciation (Partial Year) – Intermediate Accounting

Download the Workbook: http://www.tonybell.com Unlock 100+ Members Accounting Tutorials: https://www.youtube.com/channel/UCNFClg6mzfZ5ixpuH9c7f1A/join In This Video: We work through Part A of Problem 11-1A, focusing on the Straight-Line method of depreciation. Using a scenario where Martinez Construction purchases a concrete mixer on April 1, we first determine the total capitalized cost of the asset by including both the purchase price and the delivery/installation costs. Then, we calculate the depreciation expense over its 5-year useful life. Because the asset was purchased partway through the company's fiscal year, we walk step-by-step through calculating the partial-year depreciation for the first year (9 months) and the final trailing year to complete the schedule. Module Overview (IFA53–IFA61): This module explores the systematic allocation of asset costs and the rules for write-downs. We will examine the major depreciation methods (Straight-Line, Declining Balance, and Units-of-Production), handle partial-year depreciation, and navigate changes in accounting estimates. We will also dive into the specific calculations required for depleting natural resources and walk step-by-step through the strict testing rules and journal entries for asset impairment.