Under AASB 116 Property, Plant and Equipment, the purpose of calculating the depreciation charge for a period on an item of property, plant and equipment is to measure:

Question

Quizplus · Accepted Answer

The purpose of calculating the depreciation charge is to measure the consumption of economic benefits over the period, as the asset is expected to generate revenues over its useful life and gradually lose its ability to do so as it wears out or becomes obsolete. This reduction in future economic benefits is reflected in the depreciation charge. The other choices are incorrect as they do not align with the purpose of depreciation under AASB 116.

Under AASB 116 Property, Plant and Equipment, the Purpose of Calculating