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Does land depreciate?

Unlike other fixed assets, land does not wear out, become obsolete, or get used up, which exempts it from depreciation. This unique characteristic means that land retains its value on the balance sheet indefinitely, unless circumstances dictate otherwise, such as a decline in the property’s market value that is deemed to be other than temporary.

Why is land not considered a land asset?

The land asset is not , because it is considered to have an infinite . This makes land unique among all asset types; it is the only one for which depreciation is prohibited. Nearly all have a useful life, after which they no longer contribute to the operations of a company or they stop generating .

Can land be depreciated in accounting books?

The land has a physical form and a useful life exceeding one year, but it cannot be depreciated in the accounting books because: A. Unlike other tangible properties that have an expected end date, the owner of land can basically use it forever without becoming obsolete or deteriorating physically.

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