accumulated depreciation business definition

The total amount of depreciation that has been recorded for an asset since its date of acquisition. For example, a computer with a five-year estimated life that was purchased for $2,000 would have accumulated depreciation of $800 [( ^$2,000/₅ ) × 2] and a book value of $1,200 ($2,000 - $800) after two years of straight-line depreciation. Also called allowance for depreciation, depreciation reserve.