@angnima (772)
February 5, 2007 3:10am CST
Almost all business owns some non-trading fixed assets like land,building,machinery,furniture,vechiles etc. These assets are not of infinite durability . All fixed assets except land decline in value with passage of time and are reduced to scrap. That is , each year the intrinsic value of the asset declines. Such reduction in the value of asset each year is a loss and/or expense which is technically termed as depreciation. The common causes of depreciation are physical wear and tear and obsolescence.
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@Lydia1901 (16354)
• United States
14 Apr 07
Well, I do not think that I have heard of that before. That is some interesting information. Thank you for sharing it.