Question

What is depreciation? Write the various objectives of providing depreciation.

Answer 1

Objectives for providing depreciation. ... For the determination of true profit or loss: Depreciation is also an expense like repair and maintenance which must be included in profit and loss account to ascertain the correct profit or loss of a business for the year.

Answer 2

The main objective of charging depreciation is to accumulate adequate fund to replace old asset with the new one after the useful life. Depreciation is charged to fixed assets which helps to show the current value of the asset.