Depreciation in Accountancy

An actual reduction in the fair value of an asset and the allocation of the original cost of the asset to periods in which it is used (correct)

An increase in the fair value of an asset over time

The immediate write-off of the cost of an asset

The appreciation of assets over their useful life span

To reduce taxable income by allocating the cost of assets over their useful life span (correct)

To increase taxable income by inflating the value of assets

To defer tax payments indefinitely

To avoid reporting asset values on tax returns

It has no impact on the value of the assets

It reduces the net income of the business

It decreases the value of the assets (correct)

It increases the value of the assets

<p>It reduces the net income by recognizing depreciation expense over time</p> Signup and view all the answers

<p>The reduction in value placed on the asset over its useful life span</p> Signup and view all the answers