What is depreciation. What are the types of depreciation. Explain any one?

Question

Accepted Answer

Depreciation is the decrease in the value of an asset over time. Types include straight-line, reducing balance, and sum-of-the-years'-digits.

Depreciation is a method of allocating the cost of an asset over its useful life.
Straight-line depreciation evenly distributes the cost of an asset over its useful life.
Reducing balance depreciation charges a higher amount in the early years and decreases over time.
Sum-of-the-years'-digits depreciation charges more in the early years and less in the later years.
Example: A company purchases a machine for $10,000 with a useful life of 5 years. Using straight-line depreciation, the annual depreciation expense would be $2,000.

Accepted Answer

Three types of depreciation
1. Straight line
2. Double declining balance
3. Units of production

Accepted Answer

Depreciation means reduction in value, meaning the price at which we buy an asset and use it, its value is decreasing because we are using it, this is called depreciation.

Accepted Answer

Decrease in the value of an asset over a period of time

Accepted Answer

Reducing the value of assets over a period of time called depreciation.

2 types of depreciation

They are:

1.straight line depreciation &

2.Fluctuation / variable depreciation.

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