Inferences about the economic cost of a product are frequently based on measures of historic cost. We examine a model in which a firm makes a sequence of overlapping capacity investments. Earlier research has identified particular accrual accounting (depreciation) rules which have the property that on a per unit basis the historic cost of a product captures precisely its marginal cost. Relative...

The economics literature provides considerable evidence on the performance of lowincome housing programs. One issue that has not been adequately addressed by previous studies is the relative depreciation rates of subsidized and unsubsidized housing units. Simple economic theory suggests that subsidized projects should depreciate more quickly than unsubsidized units, as the rents received by own...

We study the Markov equilibria of a model of free riding in which n infinitely lived agents choose between private consumption and irreversible contributions to a durable public good. We show that the set of equilibrium steady states converges to a unique point as depreciation converges to zero. For any level of depreciation, moreover, the steady state of the best Markov equilibrium converges t...

The choice of depreciation method from among straight-line and accelerated methods can have a significant impact on the present value of expected tax payments. This is a problem that has been studied for decades, with most results indicating the optimality of accelerated methods. Recent research has begun to question this claim by relaxing one of the original assumptions ofpositive taxable inco...

This paper presents some original techniques for implementing accounting knowledge in PROLOG language. We will represent rules of operation of accounts, the texts of accounting operations, and how to compute the depreciation.