amortization

/ə,mɔ:ti'zeiʃn/

Thân thiện

Definition

1. Noun:
   • The process of gradually paying off a debt through regular payments over a specified period: This refers to the systematic repayment of a loan, where each payment covers both interest and a portion of the principal.
   • The gradual reduction in the recorded value of an intangible asset over its useful life: In accounting, this refers to the systematic allocation of the cost of an intangible asset (like a patent or trademark) as an expense over time.

Examples of Usage

• Noun:
  • The loan agreement includes a 30-year amortization schedule. (This details the plan for repaying the loan over three decades.)
  • The company's financial statements show the amortization of its software development costs. (This indicates the expense recognition for the intangible asset over its useful life.)

Advanced Usage

• "Amortization of debt": The process of extinguishing a financial obligation through installment payments.
  • The amortization of the corporate bond will be completed in ten years.
• "Amortization expense": The periodic charge to income that reflects the consumption of the economic benefits of an intangible asset.
  • The quarterly report listed a significant amortization expense for the acquired patent.

Variants and Related Words

• Amortize (verb): To gradually write off the initial cost of an asset or to pay off a debt in regular installments.
  • The business will amortize the loan over five years.
• Amortizable (adjective): Capable of being amortized.
  • The acquisition costs are amortizable over a fifteen-year period.

Synonyms

• Depreciation (specifically for tangible assets; amortization is typically for intangible assets).
• Liquidation (of a debt).
• Apportionment (of cost).

Related Phrases

• Amortization schedule: A complete table of periodic loan payments, showing the amount of principal and the amount of interest that comprise each payment until the loan is paid off at the end of its term.
  • Please review the amortization schedule to see how much principal you pay in the first year.
• Amortization period: The total time period over which a loan is scheduled to be repaid or an asset's cost is allocated.
  • The mortgage has an amortization period of 25 years.

Related Idioms

(This term is technical and financial in nature; it is not commonly used in idiomatic expressions.)

Học thuật

Noun

1. payment of an obligation in a series of installments or transfers
2. the reduction of the value of an asset by prorating its cost over a period of years

Từ đồng nghĩa

• amortisation