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Why Don't We Depreciate Land? What Are Land Improvements? Why

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Essay

Why don't we depreciate land? What are land improvements? Why do we record land and land improvements separately?


Definitions:

Annual Interest Rate

The percentage of interest you earn or pay on an investment or loan over a year, not accounting for compounding.

Interest Receivable

An accounting term for interest income that has been earned but not yet received in cash.

Common Stock

Common stock represents ownership shares in a corporation, giving shareholders voting rights and a residual claim on the corporate earnings in the form of dividends.

Par

The face value of a security or bond, which is the amount paid back to the investor when the security or bond matures.

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