What is the definition of amortization schedule?This schedule is a very common way to break down the loan amount in the interest and the principal. Most people think that by making a minimum payment for their loan, they lower the principal amount. This depends on the duration of the loan....
Amortization (Definition) Amortization is a strategy that is used to gradually reduce the value of a loan or intangible asset over a period. In other words, it is spreading out loan payments over a longer period. In accounting, this is included in the profit and loss category on the income...
What do you understand by the term creditor in accounting? What is the definition of GAAP, in terms of an audit? Define in accounting terms what are retained earnings. What is meant by the "accrual method" of accounting? What is the definition of liability in accounting?
Let’s consider the first situation. The intangible assets have a finite useful life which is measured by obsolescence, expiry of contracts, or other factors. A company needs to assign value to these intangible assets that have a limited useful life. This process is called amortization. Like th...
What is the definition of GAAP, in terms of an audit? What is the meaning of amortization in accounting? What is the difference between the liquidity and the solvency of a business? What is meant by the term service level in accounting?
Amortization is an accounting technique used to periodically lower the book value of a loan or intangible asset over a set period of time.
Definition: Amortization is the cost allocated to intangible assets over their useful lives. This process is similar to the depreciationprocess for fixed assets except alternative and accelerated expense methods are not normally allowed. The amortization process requires the use of the straight-line meth...
What Is Amortization? Amortizationis when a business spreads payment over multiple periods of time. The term is used for two separate processes: amortization of loans and amortization of assets. The amortization of assets refers to allocating the cost of an intangible asset over its useful life ...
Definition of Bonds Payable Bonds payable are a form of long term debt usually issued by corporations, hospitals, and governments. The issuer of bonds makes a formal promise/agreement to pay interest usually every six months (semiannually) and to pay the principal or maturity amount at a ...
definition of profits differs from the accounting one. Economic profit considers the effect of opportunity costs or implicit costs. While accounting profit uses only the explicit costs. Opportunity cost is the cost of letting go of another opportunity to act upon the current venture. Or it is the...