Accounting for IGCSE & O level - Accounting Procedures (Section 3 - No. 50)
What is the main purpose of the depreciation expense?
To reduce the business's tax liability
To match the expense of using an asset with the revenue it generates.
To reflect the current market value of an asset
To increase the book value of an asset over time.
Explanation
Depreciation is a way to allocate the cost of an asset over its useful life, matching expense to revenue.
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