What is depreciation?Understand calculation methods and mechanisms

Explain the correct way to depreciate!What are the things to be aware of in the purpose, the assets of the target, and the implementation of the target.

Depreciation is an important way of thinking for companies with fixed assets and one of the mechanisms you want to understand.If you depreciate it, you can effectively cost the purchase of fixed assets, so you can use it in tax saving.

However, depreciation is not the target, and there are several rules for calculating depreciation.In depreciation, it is important to accurately classify assets and calculate according to the rules.Check the necessary information to make the depreciation correct.

* In the "Founding Handbook" that writes this article, more fulfilling information is also explained in the thick "Founding Handbook / Printing Version".Please order it because you can get it for free.

Contents of this article

Advantages of depreciation

Method of accounting for depreciation expenses

減価償却の方法

減価償却費と減価償却累計額の仕訳

貸借対照表の表示方法

損益計算書の表示方法

Precautions for depreciation

summary

What is depreciation?

Depreciation is a mechanism that allows the cost of purchasing assets to be well incorporated into expenses.By increasing expenses over multiple years based on the concept of depreciation, expenses of high assets can squeeze profits and temporarily reduce profits.

First, let's understand the basic content and purpose of depreciation.

Depreciation is about fixed assets purchased for business.Based on the idea that fixed assets will deteriorate as the number of years has passed, the value will decrease, and it will be diversified in the expense period and recorded as a cost.The account of the account when booking is "depreciation expenses".

The purchased assets are recorded as fixed assets, but at that point they cannot be expensive.Every year, the purchase price is gradually increased as "depreciation expenses" at a certain amount and a certain percentage.

減価償却の目的は、その期の利益を正しく計算することです。固定資産は、その期だけで使いきるものではありません。また、固定資産は複数年に渡って利益を生み出す可能性を持っています。そこで生まれたのが、購入した時だけで経費にするのではなく使える期間（耐用年数）で分割して経費にするという減価償却の考え方です。

If you put all the expenses of the expensive fixed assets as the expenses of that period, the amount of expenses will be temporarily raised and your profits will decrease significantly.However, on the other hand, the expenses will be zero from the next term, and profits will be made without expenses.The depreciation is to correct it and to show more accurate expenses for profits.

Depreciation is the target assets and the assets that are not.In order to correctly depreciate, it is important to know the target "depreciable assets".

What can be depreciated is that the assets used in business deteriorate over time and decrease.The shape is tangible fixed assets, and those without shapes are intangible fixed assets, but there are depreciable assets regardless of tangible and intangible.

The following tangible fixed assets that can be depreciated are as follows.

Intangible fixed assets are considered to be depreciated as their value falls over time.There are the following:

Assets that cannot be depreciated are those that are not used in business, and those that do not deteriorate.Also, even if you are preparing for the business, you will not be able to depreciate unless it is operated.

Land and leasehold rights do not deteriorate, and antiques do not decrease over time.Therefore, depreciation is not possible.

Advantages of depreciation

Depreciation can have various benefits by doing it properly.Understand important benefits in running a company.

With depreciation, it is possible to record expenses, even though there is no actual expense after the purchase year.Therefore, the depreciation period is that the funds remain at hand for the amount recorded as depreciation expenses.In fact, cash does not always accumulate, but it is a mechanism that can increase expenses without spending.

Being able to grasp the correct profit and loss is also the purpose of depreciation.Since the cost of long -term use is not recorded at once, you will see how much the assets cost in one year, which made money.

Corporate taxes are paid for annual profits.Therefore, depreciation and expenses every year also have the effect of reducing corporate tax for depreciation.If you pay at once in the first year, only profits will increase and the tax amount will increase after the following year.However, if there is depreciation, it can be a long -term balance of tax payment.

Method of accounting for depreciation expenses

In order to depreciate, it is important to know the correct accounting method.I will explain how to record depreciation and calculation methods.

Only the assets used for business are depreciating.Fixed assets that are not used can only be depreciated even after the company's property.

In the depreciation calculation, be careful of the following numbers.Each has a confirmation and calculation method.

Depreciation is an account that is used for expenses when depreciation.The depreciation expenses are calculated using the cost of the acquisition and the legal useful life.

Acquisition cost is the cost of purchasing the assets.The total price of the body and the accompanying cost when the assets are acquired is the sum.The point is that not only the main unit price, but also the accompanying expenses for making assets can be used.

Included costs include shipping, transportation insurance, tariffs, trial run costs, improvement and installation costs.

The legal useful life is the number of years of amortization of assets, depending on the thing.The classification and the number of years are announced by the NTA.

For example, the building is 11 to 50 years depending on the structure.It is classified as follows.

構造・用途	細目	耐用年数
木造・合成樹脂造のもの	事務所用のもの	24
店舗用・住宅用のもの	22
飲食店用のもの	20
旅館用・ホテル用・病院用・車庫用のもの	17
公衆浴場用のもの	12
工場用・倉庫用のもの（一般用）	15
木骨モルタル造のもの	事務所用のもの	22
店舗用・住宅用のもの	20
飲食店用のもの	19
旅館用・ホテル用・病院用・車庫用のもの	15
公衆浴場用のもの	11
工場用・倉庫用のもの（一般用）	14
鉄骨鉄筋コンクリート造・鉄筋コンクリート造のもの	事務所用のもの	50
住宅用のもの	47
飲食店用のもの	–
延べ面積のうちに占める木造内装部分の	–
面積が30％を超えるもの	34
その他のもの	41
旅館用・ホテル用のもの	–
延べ面積のうちに占める木造内装部分の	–
面積が30％を超えるもの	31
その他のもの	39
店舗用・病院用のもの	39
車庫用のもの	38
公衆浴場用のもの	31
工場用・倉庫用のもの（一般用）	38

The legal useful life of equipment is as follows.

事務机、事務いす、キャビネット	主として金属製のもの	15
その他のもの	8
応接セット	接客業用のもの	5
その他のもの	8
陳列棚、陳列ケース	冷凍機付・冷蔵機付のもの	6
その他のもの	8
音響機器	5
冷房用・暖房用機器	6
電気・ガス機器	6

The remaining price is the value that remains after the legal useful life has passed.The residual price was determined because the asset was worth it even after the useful life.However, due to the tax reform, assets acquired after April 1, 2007 will be calculated at 0 yen.

There are two types of depreciation calculations.It is a good idea to know both methods, as one may not be applied depending on the type of fixed assets.

The flat -rate method is a method of depreciating the same amount every year.The calculation formula is "depreciation cost = acquisition price x depreciation rate of the flat -rate law", and the depreciation rate is defined by "Ministry Ordinance on the use of depreciable assets".

For example, if the useful life is 5 years and the acquisition price is 1.5 million yen, 300,000 yen will be recorded every year from the year you purchased it.However, in the last fifth year, only 1 yen is left and 299,999 yen is to be recorded.This is to keep it in the fixed asset ledger and understand that it is still the assets you are still using.

The fixed rate method is to reduce depreciation expenses that are recorded from the first year to the year.It is based on the fact that you have just acquired the frequency of use and the degree of contribution to profits.The calculation formula is "depreciation cost = (acquisition price -cumulative depreciation amount) x set rate depreciation rate".

The depreciation of the depreciation is the total amount of depreciation.

In the first year, the depreciation rate will be applied to the entire purchase cost, and from the following year, the depreciation rate will be applied to the depreciation, so the amount to be deprecated will decrease naturally.In this calculation, it is a rule to leave 1 yen in the last year.

Once the depreciation costs can be calculated, the journal is done and reflected in the financial statements.There are two types of journal methods.

A direct method is a method of directly subtracting depreciation expenses from fixed assets.Put fixed assets in the loans and reduce fixed assets directly.Intangible fixed assets always use this method.

Depreciation cost XX yen / fixed asset XX yen

The cumulative depreciation amount is not visible in the direct method, so it must be displayed as a note.

The indirect method indirectly reduces fixed assets using a cumulative depreciation amount without using fixed assets in the journal).

Depreciation cost xx / depreciation cumulative amount xx yen

In indirect methods, the book value of fixed assets is not visible, but you can see by subtracting a cumulative depreciation from the acquisition price of fixed assets.

The balance sheet describes the book value and depreciation of the depreciable fixed assets.The following methods include the following, but what is mainly used is display for each subject.

This is a method of describing the acquisition price of the building and the cumulative depreciation of each, according to subjects such as buildings and vehicle carriers.The acquisition price and depreciation cumulative amount are easier to understand for each fixed asset.

建物	10,000,000
減価償却累計額	△2,500,000	7,500,000
車両運搬具	1,000,000
減価償却累計額	△250,000	750,000

The method of displaying in a lump is an exceptional method.After the total amount of fixed assets acquisition prices, the total depreciation of the company's assets is described in total.

The following example is described in bulk.

建物	10,000,000
車両運搬具	1,000,000
合計	11,000,000
減価償却累計額	△2,750,000	8,250,000

Another exceptional display method is to describe the amount after subtracting a cumulative depreciation.It is often used to record directly by the method.This method does not see how much depreciation is.

建物	7,500,000
車両運搬具	750,000

In the income statement, depreciation expenses are described in the expenses (sales and general management costs) columns.

Precautions for depreciation

When depreciation, you need to pay attention to detailed rules.If it applies to a special case, carefully process accounting.

The depreciation of fixed assets must be used even when used.However, in that case, it is necessary to reasonably estimate the available period and determine the service life.If the price of used goods exceeds 50%of the new price, use the same service life as the new one.Also, if a reasonable estimate is not possible, it will be calculated by the simplified method specified by the NTA.

There are special cases when small and medium -sized enterprises and sole proprietors make depreciation.If SMEs and sole proprietors purchase depreciable assets of less than 300,000 yen, it is possible to spend a total of 3 million yen at once.

This special case is for small and medium -sized enterprises and agricultural cooperatives that have filed a blue declaration.

Those with a service life less than one year or the acquisition price of less than 100,000 yen, or less than 200,000 yen may be eligible for special requirements.Those with a service life of less than 1 year and less than 100,000 yen can be expenses for consumables, and if it is 100,000 yen or more and less than 200,000 yen, it can be expenses for one -third in 3 years.

summary

If you depreciate it correctly, you can grasp the company's finances correctly and increase the tax saving effect.However, there are assets and assets that are not, and the legal useful life used for calculation varies depending on the asset.

If you have fixed assets that are subject to depreciation, understand the right way.There are also rules in how to calculate depreciation and how to select the display method, so care must be taken when it is eligible.

The founding notebook (booklet version) posts the necessary information after starting a business, such as financing and saving tax.Please use it to support the time you start a business.

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(Edit: Founding Handbook Editorial Department)

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