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Depreciation

Wear and tear...

Question

Wear and tear as a cause of depreciation is concerned with ___________.

A

usage of the assets

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B

demand of final products

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C

cost of production

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D

better substitute available in market

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Solution

The correct option is B usage of the assets
Depreciation is a gradual diminution, loss, or shrinkage in the utility of value of an asset due to wear and tear in use, effluxion of time or obsolescence. Depreciation is the allocation of the depreciable amount of an asset over its estimated useful life.

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