annuity method of depreciation

Definition

A practice for depreciating assets with regular cash flows. The annuity method calculates the amount of depreciation by multiplying the cash flow rate of return by the book value of the asset, and subtracting that result from the cash flow for the current accounting period. Also called compound interest method of depreciation.

Featured Advertiser

Browse by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
annuity ladder annuity rate