On the Economic Nature of Depreciation

2010 ◽  
pp. 86-96
Author(s):  
A. Orlov
Keyword(s):  
Economic Theory ◽  
Economic Performance ◽  
Capital Stock ◽  
Capital Investment ◽  
Direct Costs ◽  
Fixed Capital ◽  
Economic Practice ◽  
Accelerated Depreciation ◽  
The Cost ◽  
Economic Nature

Economic theory considers depreciation as a part of value transferred from the fixed capital stock. But economic practice rejects this view. Economic performance is determined both by profit and depreciation. Their unity is to be found in capital investment and accelerated depreciation. Depreciation is not identical with direct costs, but is included in the cost price of products to ensure the renewal of fixed capital.

scholarly journals AMORTIZATION DESIGNATIONS AS A SOURCE FOR REPRODUCTION OF THE TECHNICAL BASE OF AGRICULTURE

2019 ◽  
Vol 14 (1) ◽  
pp. 152-156
Author(s):  
Асия Субаева ◽  
Asiya Subaeva ◽  
Марат Низамутдинов ◽  
Marat Nizamutdinov ◽  
Наталья Александрова ◽  
...  
Keyword(s):  
Technical Support ◽  
Fixed Capital ◽  
Agricultural Producers ◽  
Fixed Assets ◽  
Accelerated Depreciation ◽  
Long Time ◽  
The Republic ◽  
Agroindustrial Complex ◽  
The Cost

The role of depreciation in an enterprise can be represented as a source of reproduction of fixed capital and a share of the cost of production. The study of sources of financing for the processes of renewal and modernization of agriculture is considered on the example of the Republic of Tatarstan. In the agricultural sphere, the problem of the targeted use of depreciation funds is aggravated by the difficult financial situation of many agricultural producers, which reduces the amount of funds allocated for the reproduction of fixed capital. The market of agricultural machinery requires serious financial investments and improvement of the mechanism of technical support of the agroindustrial complex. One of the ways to improve this issue is the revision of depreciation methods. In Russia, for a long time, only a uniform depreciation method was used based on the useful life, when the values of fixed assets are repaid evenly over their entire service life, we propose the use of accelerated depreciation. In this regard, the purpose of the publication is to study the changes in the share of depreciation used on investments in the total amount of accrued depreciation and to propose measures to improve the reproduction of fixed capital. The analysis showed that in the Republic of Tatarstan over the past 5 years, only about 30% of the accrued depreciation deductions are sent by farmers to invest in fixed capital. According to the results of the analysis, the idea of increasing the role of depreciation deductions as a source of renewal and modernization of agricultural equipment through the system of state support and the accumulation of depreciation deductions in the form of money on deposit or special accounts in banks was considered. A scheme for the functioning of the regional depreciation fund and its controls are proposed. The introduction of a mechanism to increase the role of depreciation as a source of financing will ensure the growth and modernization of agricultural technical support through a system of targeted use of depreciation funds.

Exergoeconomic analysis of renewable multi-generation system

2020 ◽  
pp. 99-111
Author(s):  
Vontas Alfenny Nahan ◽  
Audrius Bagdanavicius ◽  
Andrew McMullan
Keyword(s):  
Capital Investment ◽  
Combined Cycle ◽  
Asian Countries ◽  
Generation System ◽  
Integrated Gasification Combined Cycle ◽  
Heating And Cooling ◽  
Integrated Gasification ◽  
Exergoeconomic Analysis ◽  
Main Components ◽  
The Cost

In this study a new multi-generation system which generates power (electricity), thermal energy (heating and cooling) and ash for agricultural needs has been developed and analysed. The system consists of a Biomass Integrated Gasification Combined Cycle (BIGCC) and an absorption chiller system. The system generates about 3.4 MW electricity, 4.9 MW of heat, 88 kW of cooling and 90 kg/h of ash. The multi-generation system has been modelled using Cycle Tempo and EES. Energy, exergy and exergoeconomic analysis of this system had been conducted and exergy costs have been calculated. The exergoeconomic study shows that gasifier, combustor, and Heat Recovery Steam Generator are the main components where the total cost rates are the highest. Exergoeconomic variables such as relative cost difference (r) and exergoeconomic factor (f) have also been calculated. Exergoeconomic factor of evaporator, combustor and condenser are 1.3%, 0.7% and 0.9%, respectively, which is considered very low, indicates that the capital cost rates are much lower than the exergy destruction cost rates. It implies that the improvement of these components could be achieved by increasing the capital investment. The exergy cost of electricity produced in the gas turbine and steam turbine is 0.1050 £/kWh and 0.1627 £/kWh, respectively. The cost of ash is 0.0031 £/kg. In some Asian countries, such as Indonesia, ash could be used as fertilizer for agriculture. Heat exergy cost is 0.0619 £/kWh for gasifier and 0.3972 £/kWh for condenser in the BIGCC system. In the AC system, the exergy cost of the heat in the condenser and absorber is about 0.2956 £/kWh and 0.5636 £/kWh, respectively. The exergy cost of cooling in the AC system is 0.4706 £/kWh. This study shows that exergoeconomic analysis is powerful tool for assessing the costs of products.

Towards New Policy Incentives for Fixed Capital Investment and Technological Upgrades in Russia

2011 ◽  
pp. 43-56
Author(s):  
A. Apokin
Keyword(s):  
Economic Policy ◽  
Capital Investment ◽  
Empirical Studies ◽  
Fixed Capital ◽  
Policy Framework ◽  
Private Companies ◽  
Russian Economy ◽  
Technological Modernization ◽  
Fixed Capital Investment ◽  
Policy Incentives

The paper approaches the problem of private fixed capital underinvestment in Russia. The author uses empirical studies of the Russian economy and cases of successful technological modernization to outline several groups of disincentives for private companies to perform fixed capital investment in Russia. To counter these constraints, a certain incentive-based economic policy framework is developed.

Who Pays for Skills?

2017 ◽  
Author(s):  
Terence Hogarth ◽  
Lynn Gambin
Keyword(s):  
Economic Performance ◽  
Education And Training ◽  
The State ◽  
National Economic ◽  
The Individual ◽  
The Cost ◽  
Investments In Education ◽  
And Training

Debates about the need to increase investments in education and training in order to improve overall national economic performance quickly result in deliberations about who should pay for those investments. If it is the individual or the employer who are the principal beneficiaries, then there is an expectation that they should share the cost of the investment proportionate to the benefit they obtain. There are, however, a number of barriers which prevent employers and individuals making optimum levels of investment which inevitably means that the State needs to step into the breach. This chapter addresses what economics has to say about who should make the investment in training and how various barriers to those investments being made can be overcome.

What Drives a Successful Technology Implementation?

2013 ◽  
pp. 340-357
Author(s):  
Kawal Kapoor ◽  
Yogesh K. Dwivedi ◽  
Michael D. Williams ◽  
Mohini Singh ◽  
Mark J. Hughes
Keyword(s):  
Public Sector ◽  
Radio Frequency Identification ◽  
Technology Implementation ◽  
Capital Investment ◽  
Stock Management ◽  
Implementation Team ◽  
Public Sector Organizations ◽  
Self Service ◽  
The Individual ◽  
The Cost

Radio Frequency Identification (RFID) is revolutionizing item identification and tracking. The technology demonstrates complexities in terms of (a) huge initial capital investment, (b) validating the need for RFID followed by its implementation decisions, (c) risks associated with consumer acceptance and consequences of incorrect implementation, and (d) capability to support enhancements and upgrades in cordial agreement with the individual implementer organizations. This paper explores the extent of RFID implementation at the Swansea University Library, examining the Social, Technological, Economic, and Managerial (STEM) aspects directly associated with implementation. A focused interview approach was resorted to, for data collection purposes. The core implementation team for RFID at Swansea University was interviewed to gain insights into the study’s areas of interest. It was found that self service is the most sought after benefit. It simplifies stock management and enhances security at the libraries. Although the cost of the system remains a concern, varying on the basis of the scale of implementation, vandalism also continues to exist but to a reduced degree. University libraries are public sector organizations, consequently leading these findings to have an insinuation for RFID implementations in other public sector organizations as well.

Distillation-based Separation Systems Synthesis

1995 ◽  
Author(s):  
Christodoulos A. Floudas
Keyword(s):  
Capital Investment ◽  
Optimal Configuration ◽  
Synthesis Problem ◽  
Total Annual Cost ◽  
Separation Processes ◽  
Distillation Columns ◽  
Separation Systems ◽  
Total Capital ◽  
Separation Sequence ◽  
The Cost

This chapter presents two applications of MINLP methods in the area of separations. Section 9.1 provides an overall introduction to the synthesis of separation systems. Section 9.2 focuses on sharp heat-integrated distillation sequencing. Section 9.3 presents an application of nonsharp separation synthesis. The synthesis of distillation-based separation sequences has been one of the most important subjects of investigation in the area of process synthesis. This is attributed to the significant contribution of separation processes to the total capital investment and operating expenses of a chemical plant. As a result, a lot of interest has been generated in the development of systematic approaches that select optimal sequences of distillation columns. Westerberg (1985) provided a comprehensive review of the distillation-based separation synthesis approaches, as well as presented a classification of different types of separation problems along with their associated challenges. Nishida et al. (1981) and Smith and Linnhoff (1988) reviewed the general separation synthesis problem (i.e., not only distillation-based) and presented the progress made. To illustrate the nature of the distillation-based separation system synthesis problem, let us consider its generic definition shown in Figure 9.1, which is as follows: . . . Given a number of input multicomponent streams which have specified amounts for each component, create a cost-optimal configuration of distillation columns, mixers, and splitters that produces a number of multicomponent products with specified composition of their components. . . The products feature components that exist in the input streams and can be obtained by redistributing the components existing in the input streams, while the cost-optimal configuration corresponds to the least total annual cost one. Most of distillation columns or sequences can be classified as (i) Sharp, (ii) Nonsharp, (iii) Simple, (iv) Complex, (v) Heat-integrated, and (vi) Thermally coupled. In (i), a column separates its feed into products without overlap in the components. An example is the separation of a stream consisting of four components A, B, (C, and D via a distillation column, into one product consisting of only A and another product featuring B, C, and D. If all columns are sharp, then the separation sequence is termed as sharp sequence.

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