Question

Depreciation arises due to ___________.

• A. wear and tear
• B. efflux of time
• C. obsolescence
• D. all the three

Answer 1

Answer: (D)

all the three

Fixed asset are depreciated year on year basis due to its usage, normal wear & tear and obsolescence. Hence depreciation has to be charged every year by debiting the same to profit & loss account by reducing the value of asset.

Depreciation arises due to:

• Wear and tear
• Efflux of time
• Obsolescence