Curated and Reviewed by
Lesson Planet
In order to effectively demonstrate depreciation of a capital asset, Sal outlines the COGS for a company over four years, including a factory tooling cost required every two years. As he calculates the operating profit, learners see that the company, although turning a steady revenue, appears unstable. Sal uses this to explain why a statement incorporates depreciating tangible assets spread evenly over the years, illustrating it on company balance sheets. He also leads into the next video by contrasting depreciation with amortization.
15 Views
5 Downloads
Additional Tags
Resource Details
Creative Commons
BY-NC-SA: 3.0