Method of Component Depreciation of Fixed Assetsts and Its Comparision with Traditional Methods

M. Starova and Helena Cermakova

AGRIS on-line Papers in Economics and Informatics, 2010, vol. 02, issue 3, 10

Abstract: This contribution analyzes, based on specific examples, accounting procedures and tax implications of depreciation of tangible fixed assets. It compares the component method, which has recently appeared in the Czech legal regulations, with the traditional methods. To compare the effects that the traditional methods have on profit or loss, or rather on the tax base, also the generation of provisions is used. The use of component depreciation is governed solely by the accounting regulations while the Income Tax Act has not been changed in this respect. Profit of loss has to be adjusted by a difference amount between accounting depreciation and tax depreciation in tax return.

Keywords: Political; Economy (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aolpei:96874

DOI: 10.22004/ag.econ.96874

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