Depreciation

Question

Depreciation

Quizplus · Accepted Answer

Depreciation is the accounting process of allocating and deducting the cost of an asset over a period of years. It should be used for assets that have a limited useful life, as their value will decrease over time. Depreciation is calculated on all assets except for land, which is considered to have an indefinite useful life and therefore does not depreciate. Depreciation is not used instead of tracking maintenance expense; these are separate concepts that should both be taken into account when accounting for assets.