Write-Down
Content
Definition
A Write-Down is an accounting action resulting in the reduction of the book value of an asset because it is overvalued compared to the market value, reflecting a more accurate valuation of the asset on financial statements.
Usage and Context
A write-down lowers the book value of an asset to match its true market value, adjusting financial statements.
Frequently asked questions
- What does a write-down mean in accounting? A write-down in accounting means reducing the book value of an asset because it is overvalued compared to the market value.
- What is write-down in asset value? A write-down in asset value is an accounting adjustment that reduces the book value of an asset due to a decline in its market value.
- What is accounting write-down? An accounting write-down is reducing the book value of an asset when its market value falls below its carrying value on financial statements.
Benefits
A write-down adjusts an asset`s book value to match its true market value, ensuring accurate financial statements.
Conclusion
A write-down adjusts an asset`s value to reflect its true market worth, ensuring accurate financial records.
