Unit 8: Fixed Assets and Depreciation
TechStart Solutions is growing and buying long-term assets. How do we track them professionally and choose the right depreciation method?
Students learn why long-term assets are tracked differently from everyday expenses, master depreciation methods by hand, and build a professional asset register workbook. The unit culminates in a group project where teams recommend a depreciation policy backed by workbook evidence.
- ▶Build a professional asset register with all required fields in Excel
- ▶Create a linked depreciation schedule that calculates annual expense, accumulated depreciation, and book value
- ▶Build workbook checks so accumulated depreciation and book value stay believable
Assets
Resources owned by a business that have future economic value, such as cash, equipment, or inventory.
Depreciation
The systematic allocation of a fixed asset's cost over its useful life, reflecting wear and tear or obsolescence.
Straight-Line Depreciation
A depreciation method that allocates equal expense each period: (Cost − Salvage Value) ÷ Useful Life.
Accumulated Depreciation
The total depreciation expense recorded for an asset since it was acquired; a contra-asset account that reduces book value.
Fixed Assets
Long-term tangible assets used in business operations that are not expected to be converted to cash within one year, such as buildings, vehicles, and equipment.
Capital Expenditure
Money spent to acquire or improve a long-term asset, recorded on the balance sheet rather than as an immediate expense.
Useful Life
The estimated period over which a fixed asset is expected to be productive before it is retired or replaced.
Salvage Value
The estimated amount a fixed asset can be sold for at the end of its useful life.
Double-Declining Balance
An accelerated depreciation method that applies twice the straight-line rate to the asset's book value each year.
Book Value
The net value of an asset on the balance sheet, calculated as Original Cost minus Accumulated Depreciation.
Asset Register
A detailed record of all fixed assets owned by a business, including cost, acquisition date, useful life, depreciation method, and current book value.
Depreciation Schedule
A table showing the annual depreciation expense, accumulated depreciation, and book value for each asset over its useful life.
Excel Table
A structured range of data in Excel with named columns, auto-expanding formulas, and built-in formatting.
Contra Account
An account that reduces the balance of a related account, such as Accumulated Depreciation reducing Fixed Assets.
Study these terms
These 14 terms appear across this unit. Use the bilingual glossary to review them, or start a vocabulary study session to practice with flashcards, matching, and speed round.
Practice this unit's vocabulary with flashcards, a matching game, or a timed speed round. Your progress is tracked locally and can be exported.
Startup pitch to venture capital panel
When Does a Cost Become an Asset? — Capitalization, Useful Life, and Salvage Value
Ready to prove your depreciation mastery? Launch the Unit 8 practice test to rehearse fixed asset tracking, depreciation methods, asset register management, and professional presentation standards with randomized questions from every Fixed Assets and Depreciation lesson.
Tip: Complete Lesson 10 first so you can apply final QA checks, audit-readiness validation, and professional pitch polish while reviewing your answers.