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Question
What is depreciation in accounting? Give an example.
What is depreciation in accounting? Give an example.
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Solution
According to accounting terms, depreciation is characterized as the decrease of the recorded expense of a fixed asset or resource in a deliberate way until the worth of the resource becomes zero or negligible.
An illustration of Depreciation – If a conveyance truck is bought by an organization with an expense of Rs. 100,000 and the normal utilization of the truck is 5 years, the business may devalue the resource under devaluation cost as Rs. 20,000 consistently for a period of 5 years.
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According to accounting terms, depreciation is characterized as the decrease of the recorded expense of a fixed asset or resource in a deliberate way until the worth of the resource becomes zero or negligible.
An illustration of Depreciation – If a conveyance truck is bought by an organization with an expense of Rs. 100,000 and the normal utilization of the truck is 5 years, the business may devalue the resource under devaluation cost as Rs. 20,000 consistently for a period of 5 years.
Also see:
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