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What is depreciation?
Depreciation is the financial measure of how the value of an asset decreases over time
Depreciation is an expense that accounts for the estimated loss in value of an asset during a given period
It is an expense that does not involve spending money
How is depreciation used?
It is used to spread the cost of the assets over their expected useful life
You need to know two methods to calculate depreciation
Straight line method
Reducing balance method