_____ is an accounting term that refers to charging a portion of a capital item's cost as a deduction against the company's annual revenue for purposes of determining its net income.

Question

Quizplus · Accepted Answer

Depreciation is the accounting method of allocating the cost of tangible assets over their useful life in a systematic and rational manner. It reduces the value of a company's fixed assets over time as they age or become obsolete. This non-cash expense is deducted from the company's revenue for the period, lowering its net income or taxable income.

_____ Is an Accounting Term That Refers to Charging a Portion