DEPRECIATION AND AMORTIZATION Definition

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DEPRECIATION AND AMORTIZATION is the standard line item in an income statement that sums: Depreciation, the non-cash expense of a tangible investment over time and Amortization, the non-cash expenses of an intangible investment over time.

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DIRECT FINANCING LEASE is one in which the lessor's only source of revenue is interest. The lessor (generally a bank or other financial institution) buys an asset and leases it to the lessee. This transaction is an alternative to the more customary lending arrangement in which a borrower uses the loan proceeds to purchase an asset. A direct financing lease is the functional equivalent of a loan.

AUCTION-RATE PREFERRED STOCK is preferred stock issues in which dividends are reset every 49 days through a Dutch Auction bidding process. These securities are known by many names coined by the underwriters who bring them to market. Other names are: Auction Market Preferred Stock (AMPS), Cumulative Auction Market Preferred Stock (CAMPS), Dutch Auction-Rate Transferrable Securities (DARTS), Floating-Rate Auction Preferred Stock (FRAPS), Market Auction Preferred Stock (MAPS), Rate Adjustable Preferred Stock (RAPS), Short-Term Auction-Rate Stock (STARS) and Money Market Preferred (MMP).

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