Difference between revisions of "Amortization"
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− | ''' | + | In accounting, '''amortization''' refers to the charge-off to expense of intangible assets over a period of time. It is similar to the concept of [[depreciation]] for tangible assets, except that generally amortization is done on a straight-line basis. Also [[goodwill]] is not subject to amortization. |
− | + | The term is also used in [[real estate]] to refer to the "amortization schedule", a listing of each normal monthly payment on a [[mortgage]] which breaks down how much is allocated to interest, principal, and escrow. (The schedule does not take into consideration any accelerated or additional payments which the homeowner may choose to make along with the normal monthly payment.) | |
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[[Category:Accounting]] | [[Category:Accounting]] | ||
− | [[Category: | + | [[Category:Real Estate]] |
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Revision as of 16:42, March 2, 2018
In accounting, amortization refers to the charge-off to expense of intangible assets over a period of time. It is similar to the concept of depreciation for tangible assets, except that generally amortization is done on a straight-line basis. Also goodwill is not subject to amortization.
The term is also used in real estate to refer to the "amortization schedule", a listing of each normal monthly payment on a mortgage which breaks down how much is allocated to interest, principal, and escrow. (The schedule does not take into consideration any accelerated or additional payments which the homeowner may choose to make along with the normal monthly payment.)