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Write Off
Write off refer to either accounting write off or income tax write off . It refers to a term commonly used in vehicle insurance too . It is generally used to describe a vehicle that is cheaper to replace than to repair. As for as accounting is concerned , it refers to the expensing of a balance sheet asset (item) which has no future benefits.
The best example for write off is writing off a goodwill . Generally , the worthless assets will be recorded as expenses in the income statement of the current period instead of keeping it on the balance sheet as an asset .
When compared to amortization and depreciation the write off has the characteristic feature of a one time charge against profit and loss earnings. A term similar to write off is write down which is a partial write -off . In this case only part of the asset will be removed from the balance sheet .
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