Anglicky v odborných předmětech "Support of teaching technical subjects in English“

1. Anglicky v odborných předmětech"Support of teaching technical subjects in English“ Tutorial: Business Academy Topic: Fixed Assets – Depreciation (1st part) Prepared by: Ing. Jana Šustrová Projekt Anglicky v odborných předmětech, CZ.1.07/1.3.09/04.0002 je spolufinancován Evropským sociálním fondem a státním rozpočtem České republiky.

2. Tangible fixed assets depreciation (TFA) • Physical – as a result of use, by external influence • Moral – as a result of technical development Depreciation = tangible fixed assets depreciation per an accounting period Accumulated depreciation =total depreciation of the fixed assets for the entire period of use Purchase price–accumulated depreciation=residual price

3. Typesof depreciation • Accounting depreciation • They express the actual assets depreciation • They are in accordance with physical and moral depreciation of assets • They are based on the Accounting Act. The company determines them in their depreciation schedule. • Tax depreciation • They are based on the Income Tax Law • They express maximum amount that can be as depreciation applied as a tax deductible expense

4. Method for calculating the depreciation of tangible fixed assets 1. The inclusion of depreciation in the property under the Income Tax Act

5. 2. Determination of depreciation method • Straight-line depreciation • The maximum depreciation rates are assigned to the depreciation groups • Annual depreciation = (input price x annual rate) / 100

6. Accelerated depreciation • The rules are defined in the Income Tax Act • The basis are coefficients that are assigned to depreciation groups • The period of depreciation is not shorter, but the depreciation is higher at the beginning in comparison with straight-line depreciation 1. year = input price following years= 2 x residual price k1 k – n k1 = coefficient in the 1st year of depreciation k = coefficient for following years n = number of years that has been depreciated

7. Table of coefficients for accelerated depreciation

8. Rules for tax depreciation • Fixed assets that were assigned to use have been depreciated • Pieces of land, works of art and collections have not been depreciated • The selected method of depreciation cannot be changed over the depreciation period • Depreciation is possible up to the amount of the purchase price • Tax depreciation has been expressed as annual • Owner depreciates the property • Depreciation should be rounded up to the nearest crown

9. Questions: • How have been fixed assets worn? • What is the depreciation group? • Which law does the tax depreciation govern? • What does accumulated depreciation mean? • What is the relationship between the accumulated depreciation and the residual price? • How do we recognise that the property is fully depreciated? • Is it possible to change depreciation method during the depreciation period?

10. Bibliography: • Štohl, P. Učebnice účetnictví 2011 – 2. díl pro střední školy a pro veřejnost. Znojmo: NAKLADATELSTV Í ŠTOHL PAVEL ING. – VZDĚLÁVACÍ STŘEDISKO,2011.ISBN 978-80-87237-36-6. • Švarcová J. a kol. Ekonomie -stručný přehled, teorie a praxe aktuálně a v souvislostech. Zlín: TOPPEX, s. r. o., 2009.ISBN 978-80-903433-7-5.