Bookkeeping

Capital Finance Lease vs Operating Lease Explained: Differences, Accounting, & More

Capital leases also have accounting features that are a bit more involved than what needs to be done for an operating lease, such as creating an additional liability account called Capital Lease Payable. The main drawback of an operating lease is due to the lack of ownership at the end of the lease agreement. And …

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Depreciation Tax Shield Formula + Calculator

Lastly, the Sum-of-the-Years’-Digits method is a more complex form of accelerated depreciation that combines elements of both the straight-line and declining balance methods. The choice of depreciation method can significantly affect a company’s financial statements and tax obligations. Anyone planning to use the depreciation tax shield should consider the use of accelerated depreciation. By using …

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