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What is the basic difference between depreciation and amortization?

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Question ajoutée par M Umar Azam , Senior Accountant , Mustafa Furnishing Industries FZC
Date de publication: 2015/12/07
Moataz Azmy
par Moataz Azmy , Sales Manager , Active on

amortization refers to the intangible assets but the depreciation refers to the tangible assets

Depreciation is the decrease in the value of tangible assets 

amortization is the decrease in the value of intangible assets

Mohammed Ibrahim AlAgroud
par Mohammed Ibrahim AlAgroud , Credit Supervisor , Sulfah Financing Company

Depreciation is for the tangible / Fixed assets i.e. building, devices, furniture, etc.

while the amortization is for intangible assets i.e. patent, copyrights, goodwill, etc. 

JULIUS MURE MWARO
par JULIUS MURE MWARO , ACCOUNTANT , said abeid said & co.

DEPRECIATION IS CHARGED ON TANGIBLE ASSETS SUCH PROPERTY ,PLANT & EQUIPMENT WHILE AMORTIZATION IS ON INTANGIBLE ASSETS SUCH AS GOODWILL, COMPUTER SOFTWARE.

Utilisateur supprimé
par Utilisateur supprimé

Depreciation is for fixed assets (Be.g. Building, Machines) while amortization is for intangible assets (e.g. patent, copyright)

Yahia Omran Ibrahim
par Yahia Omran Ibrahim , Head Of Finance , Afaq Alnama for logistics

Depr. is decrease the Fixed Asset & amortizition is decrease the intangible assets but the both in financial statement the same classfaction

Sohail Lone
par Sohail Lone , Assistant Manager Audit , Deloitte - United Arab Emirates

As per IAS Intangibles are amortized ,and as per IAS  Property,Plant and Equipment are depreciated

Michael Cabuang
par Michael Cabuang , Accountant , Samsung Saudi Arabia. Co. Ltd

Depreciation usually refers to speading the cost of a tangible assets over its usefull life however amortization refers to the speading the cost ot intangible assets over its useful life. 

depreciation - tangible assets

amortization - intangible assets 

moreover, amortization can also be refers to the installment value of a loan.

Wasim khan wazir
par Wasim khan wazir , Finance Specialist , Mott Macdonald

Wear & tear in value of tangible assets is called depreciation while wear & tears in value of intangible assets is called depreciation. By nature both are same(revenue expense) but different terms are used in accounting.

Mujibur Rahman ACCA
par Mujibur Rahman ACCA , Founder And CEO , MR-Accountants

The economic benefit realized from a tangible asset is consider as depreciation, on the other hand for intangible asset this is consider as amortization. Both amortization and depreciation are methods of spreading the cost of the asset throughout its useful life. Depreciation is for tangible asset and Amortization is for intangible asset.

OWAIS QAZI
par OWAIS QAZI , Accounts & Finance Manager , Skyhigh Industries (Pvt) Ltd.

Depreciation is for Tangible Assets whereas Amortization costs charge for intangible assets.

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