Why depreciation is not charged on land?

Questions by nictian

Showing Answers 1 - 16 of 16 Answers


  • Aug 26th, 2008

Land does not get depreciated. The reason being that the depreciation is supposed to be the reduction in value of an asset because of a) usage, b) extraction, c) obsolence etc.

Either the capital asset is used and can no more provide as much level of output or some asset from which minerals, coal etc are extracted are getting exhausted or some technology etc are getting obsolete so they are depreciated.

Land is not subject to either of the things. The market value of the land may go down because of seasonal reasons, but land cannot get depreciated.


sanjeev verma

  • May 25th, 2012

Land, Gold & petrol always appreciated.

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  • Jun 1st, 2012

Land is a fixed asset even though we can not correct valuate,because its differ depend on usage or production.Never land value decrease.

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  • Jul 17th, 2012

The Gradually reduction in the value of fixed assets due to wear and teer. The term Depreciation belongs to fixed assets.
Depreciation is first debited to depreciation amount data.
it is transfers to p&l a/c to debit side.

Imp: Depreciation reduce the value of fixed asset and net profit.

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  • Jul 19th, 2012

In order to charge depreciation, we must know the expected life of the Asset. So in the case of Land, we cannot calculate the expected life of the land.

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  • Jul 25th, 2012

land price increase always that's why depreciation not charged on land

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  • Jul 31st, 2012

The LAND will appreciate because it worth more over years, where is the improvements in the land is depreciate it

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manish mittal

  • Aug 9th, 2012

what are the rules of dr. & cr.

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  • Sep 5th, 2012

The value of land is indefinite.

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Kishore Swamy

  • Sep 10th, 2012

The value of land is not depreciate therefore it is not cover in the definition of depreciation.

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  • Feb 5th, 2013

Since Fixed assets are used to generate periodic revenue, an appropriate proportion of the cost of fixed assets, which is believed to be used or expired for generation of periodic revenue, needs to be charged as cost. Such an appropriate proportion of the cost of fixed assets is termed as DEPRECIATION.

Depreciation is charged on fixed assets except land as value of land never depreciates. There are two methods of calculating depreciation : 1. Straight line method, 2. Written down value method.

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  • Aug 10th, 2013

Depreciation in known as gradual decline in the usable value of the asset due to various factors i.e technological changes etc.

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nabasmita bordoloi

  • Feb 28th, 2014

depreciation refers decrease the value of tangible fixed assets due to wear and tears, technology obsolesces , passes of time etc. but land is a tangible asset which value never decreases. land value is always appreciated.

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