Physical depreciation occurs when changes in customer needs causes a fixed asset to no longer provide services for which it was intended.

Question

Quizplus · Accepted Answer

Physical depreciation refers to the wear and tear or aging of a fixed asset over time, not changes in customer needs. Changes in customer needs leading to an asset no longer providing the intended services would be considered economic or functional obsolescence.

Physical Depreciation Occurs When Changes in Customer Needs Causes a Fixed