Explain Deprecation account.
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Answers
DEPRECATION ACCOUNT:-
Depriciation can be defined as the reduction in the value of an asset with the passage of time due in particular to wear in tear.
In simple words we can define it as the reduction of the cost of an asset due to its continuous use or due to any other thing like breakage.
Such accounts are usually related to accounted settings.
It is usually used in clearing cache datas.
Answer:
In accounting, depreciation is the assigning or allocating of the cost of a plant asset (other than land) to expense in the accounting periods that are within the asset's useful life.
Example of Depreciation
Let's assume that a business purchases a delivery truck with a cost of $100,000 and it is expected to be used for 5 years. If we also assume that the truck will have no salvage value, the company will record depreciation expense of $100,000 over the five years. When the straight-line method of depreciation is used the annual depreciation expense will be $20,000. (The amounts can vary depending on the depreciation method and assumptions.)