Week 11 — Readings & Resources

Your primary reading is Chapter 11 (in this module). Everything below is the optional, go-deeper layer — pick what helps, skip the rest.

How to use this page

This page has 10 items (4 readings and 6 videos). Allow 56–66 minutes for everything. Each group points back to the matching chapter section and class-session segment, so use the full menu when you want more, or take the quick path below.

Every video here has captions: turn them on with the CC button in the player. The chapter covers the same ideas in text.

Pick-one quick path (20–23 min total)

• Straight line depreciation — The Finance Storyteller
• Calculating Depreciation Expense using Double Declining Balance — Learning with Luke
• Depreciation: methods for depreciation — Wikipedia

① What an asset costs, and what depreciation is

Chapter 11, Section “Measure an asset's cost” · Session 1, Segment 1, “The cost of a long-lived asset” · Remember: an asset's cost includes everything needed to get it ready for use, and depreciation shares that cost out over the years that use it.

• Depreciation explained — The Finance Storyteller — a company truck bought for one large payment and spread over five years with no residual value, showing that cash falls once at the purchase while depreciation moves the cost into expense year by year; it calls depreciation a non-cash expense, nets historical cost against accumulated depreciation, and notes that a tangible asset is depreciated while an intangible one is amortized. Its remark that tax rules can differ from reporting rules is a pointer, not advice. Use it while completing the Week-11 module overview. (video, 9 min) (captions: creator)
• Publication 551, Basis of Assets: Cost Basis — Internal Revenue Service — the IRS's short Cost Basis section, which lists freight and installation and testing among the amounts that go into what you paid for property; it is written for tax basis, not financial statements, but it makes the same point as the chapter about getting an asset ready for use. This builds on Week 4's work with adjusting entries and depreciation. (reading, 3–5 min)

② Three ways to spread the cost

Chapter 11, Section “Spread the cost evenly: the straight-line method” · Session 1, Segment 2, “Straight-line, units-of-production, and double-declining-balance” · Remember: every method moves the same depreciable cost into expense; only the timing differs, and no method goes below residual value.

• Straight line depreciation — The Finance Storyteller — a machine's capitalized value, including shipping and installation, spread in equal steps down to its residual value, with the formula (cost minus residual value over useful life), the purchase and depreciation entries, and net book value year by year; its closing minutes show large companies changing their estimated useful lives. Its opening line calls depreciation a decrease in value, where the chapter treats it as cost allocation. (video, 9 min) (captions: creator)
• Units of Production Depreciation — Learning with Luke — an invented consulting company's vehicle depreciated by the mile, with the rate found from cost minus salvage value over total expected miles and a four-year schedule of depreciation, accumulated depreciation, and book value; the last year is cut back because the vehicle drove more miles than expected, so book value stops at the salvage value. (video, 6 min) (captions: automatic)
• Calculating Depreciation Expense using Double Declining Balance — Learning with Luke — the same invented vehicle depreciated at twice the straight-line rate on each year's starting book value, with no salvage value subtracted at the start; in the final year the method would push book value below the salvage value, so the video stops it there, the same floor the chapter's van reaches. (video, 5 min) (captions: automatic)
• Depreciation: methods for depreciation — Wikipedia — the encyclopedia's section on depreciation methods; read the straight-line, diminishing balance, and units-of-production parts and skip the annuity, sum-of-years-digits, group, and composite methods, which this course does not teach. It says depreciation is a method of allocation, not valuation, and it also carries an unsourced line calling one method a better fit for vehicles, a ranking this course does not make. (reading, 6–9 min)

③ Selling an asset, and assets you cannot drive

Chapter 11, Section “Dispose of an asset: gain or loss” · Session 2, Segment 3, “Disposal, intangible assets, and natural resources” · Remember: a gain or loss is cash received minus book value, and patents are amortized while natural resources are depleted.

• How to Journalize Fixed Asset Sales and Disposals — Accounting with Audra — one piece of office furniture disposed of and then sold, first when fully depreciated and then when some book value remains, with the entries that remove both the asset's cost and its accumulated depreciation and record a gain or a loss; it closes by showing that the total cost to the business comes out the same either way. Stop here before liabilities; next week turns to what the shop owes. (video, 5 min) (captions: automatic)
• Depletion - Natural Resources — Katheryn Reynolds — a short explanation of capitalizing a natural resource's cost and moving it into depletion expense and accumulated depletion by the units removed, as cost allocation; it also says which method a resource and its equipment must use and mentions asset retirement obligations, points this course does not cover, so keep to the depletion idea. (video, 4 min) (captions: automatic)
• Patent essentials — U.S. Patent and Trademark Office — the federal patent office's plain answers on what a patent is, the right it gives an inventor to stop others from making, using, or selling an invention, and how long that right lasts; read it to see why a purchased patent is an intangible asset with a finite life, whose cost is amortized. (reading, 4–6 min)

Optional one-stop reference (free online reference)

• Publication 946, How To Depreciate Property: What Property Can Be Depreciated? — Internal Revenue Service — the IRS's depreciation guide, deep-linked to its section on what property can be depreciated, with a small business's van among its examples; read that section and the short part on what cannot be depreciated, such as land, and skip the tax methods and deductions, which follow tax rules this course does not teach and are not advice. (reading, 5–8 min)

Heads-up (links rot): these point to outside sites that occasionally move or rename pages. If a link ever fails, tell your instructor and use the reference above in the meantime.

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