Is accumulated depreciation the same as provision for depreciation?
submitted by Dewey Cheatham

notsobad

They're related but not the same thing. Provision for depreciation is like setting aside a part of the asset's cost each year as an expense, and accumulated depreciation is the total of all those provisions added up over time.

Provision is the yearly "depreciation expense," and accumulated depreciation as the running total.

strongmad

No, accumulated depreciation and provision for depreciation are not the same. Provision for depreciation is an expense account. It's an estimate of the depreciation in the current period. Accumulated depreciation is a contra asset account that records the total depreciation charged on an asset up to that point.

So, provision for depreciation is for an individual period, while accumulated depreciation is the grand total so far.

yeah_buddy

Provision for depreciation is just the amount you'd record as depreciation expense for a year. Accumulated depreciation is the total of all those yearly expenses added together. If you've had a tractor for 5 years, the accumulated depreciation would be how much you've paid since you got the tractor.