Q: Do I include the purchase price of the hotel in my accounts as an asset and do I depreciate it?
A: The hotel is an asset if:1) You own or control it,2) It will bring your business benefits in the future, and3) You can value it accurately.Those are the three criteria for recognizing any asset.Review the lesson on assets for examples of different assets and applying the recognition criteria to them.Now, with regards depreciation, generally the rule regarding buildings is to depreciate them, and to depreciate them over a pretty long period - say 30 or 50 years.For lessons, tutorials, questions and exercises on depreciation, check out the site's official basic accounting book.
Click here to post comments
Return to Ask a Question About This Lesson!.
Advertise on Accounting-Basics-for-Students.com
Search this site:
Stay up to date with ABfS!Follow us on Facebook:
All the lessons on this site and much, much more...
Available Now On