( Accounting : Financial statements )
We can't ask accountants to recalculate each asset's present value every time income
is calculated, but we can ask them to match book depreciation schedules to typical patterns of economic depreciation.
When tax depreciation exceeds book depreciation in the early years of property life, deferred taxes are charged to expense with a
contra credit to a liability account.
Book depreciation is depreciation in a company's internal financial records that is different from
the amount that is used for taxes.
Collins English Dictionary. Copyright © HarperCollins Publishers