Financial Glossary
Depreciation
What is Depreciation?
Depreciation is the process of allocating the cost of a tangible asset over its useful life, reflecting its decline in value over time.
???? Methods of Depreciation
| Method | Description | Example |
| Straight-Line | Spreads cost evenly over the asset’s life | Office equipment |
| Declining Balance | Accelerated method, higher depreciation in early years | Vehicles, machinery |
| Units of Production | Based on usage or output | Manufacturing equipment |
???? Related: Amortization | Accrual Accounting
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