Mariana for the situation thinks about introduced above


Mariana Radu showed in her article
that how to record depreciation expenses in management accounting in Romania. The
purpose of this research is to show the impact of depreciation methods on costs
used in Romania. She used both
theoretical research on the concepts of theories and regulations in the field
existing so far and also empirical research by presenting case studies trying
to find solutions to the problems as mentioned in the article. Depreciation
always create a negative impact on cost according to Mariana Radu Research


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After the outcomes acquired for the
situation thinks about introduced above we can presume that deteriorations,
other than straight-line, when rehearsed, unequally stack expenses of
progressive periods. Number one speculation is in this way approved. The second
theory is likewise approved, the introduced repetitions of deterioration costs
in money related bookkeeping going for a discerning assurance of the creation
costs computed in administration bookkeeping. The deterioration incorporation
into expenses ought to think about the degree of use of creation limit. Every
year should be recalculated the devaluation included into costs in view of the
present estimation of the advantage and the likely term of utilization.
Additionally, the advantages must be really working and devaluation costs must
be fused into the cost as long as the benefit is utilized, regardless of
whether it is completely deteriorated in monetary bookkeeping.



Mariana Radu had done the research on
the topic impact of depreciation on cost by analyzing the theoretical researches,
regulation in this particular field and also presenting case studies on the
topic to get the problem solution that appeared with this research.



Many researches had been done on the
impact of depreciation methods on cost. Some ?rms and individuals had been
discussed the regulation influences in the theoretical and empirical tax
literature. Due to progressive tax system’s Straight line method might be
suitable if there are some growing and stable cash flows while accelerated
depreciation method (DDM and SOYDM) provides discount benefits. Straight line
method is also used if taxation authorities allows to switching the
depreciation method. Accelerated deprecation method reduces the amount of
taxable income of an asset in the early life and the tax liabilities are
deferred so that the company had to pay the more income taxes in the later

Literature Review:

Introduction: Depreciation
is the process to calculate the decreasing value or Out dated depreciable value
of Long lived assets (Fixed Assets) like: Building, vehicles, Furnitures,
Machinery and office Equipments .Some fixed assets cannot be depreciated For
Example: Land etc. Current assets cannot be depreciated just because of their
time period. Fixed Assets are those assets which have a time period more than 1


Abstract: Depreciation
has no concern with the market value of fixed assets. Which may very
considerable from the net cost of the asset at any given time. Depreciation has
a major issue in the calculation of the company’s cash flow because it is
included in the calculation of net income. The Accumulated depreciation account
is a contra account that will appears on the balance sheet as a deduction from
the original purchase price of an asset .In the recording of depreciation, it
should be debit in the depreciation expense account and credit to the
accumulated depreciation account. If an asset will not fully depreciated at
that time of its disposal then it will also be necessary to record a loss on
undepreciated portion.



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