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Home > Business & Careers > Accounting   »   depreciation

 
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Old Nov 16, 2006, 07:11 AM
Robert Valade
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depreciation

is depreciation considered a fixed or variable cost?

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Old Nov 16, 2006, 08:45 PM   #2  
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It would be a fixed cost.

Although, it also could be an indirect variable cost.
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Old Nov 23, 2006, 12:00 AM   #3  
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depreciation is considered as variable cost, fixt are you rent, your car payment,exedra....
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Old Nov 23, 2006, 03:41 AM   #4  
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I think both fixed or variable depending on how you are taking it on either a financial stmt such as a balance sheet or with the IRS. For example you can tell the IRS you purchased an automobile for use in your business. You could evenly depreciate the veh over it's useful life of say 5 years taking $2000 per year for 5 yrs, then no more depreciation expense would be allowed or you could use the veh excessively and choose to depreciate it faster over two years and in this case the depreciate expense would be $5000 per year. Keep in mind this is just an example, the specifics might not comply with IRS rules. I just wanted to give an example. Another example would be where one takes an allowance for $8000 the first year then a final allowance for $2000. I am no CPA so someone chime in who has more experience, education or training than me.

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CaptainForest agrees: I agree. It can be both, depending on the situation.
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