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Answer Posted / sanmilan
All Assets have a Life Span. The capacity or productivity of
any particular asset need not be same as initial years after
using the same for 5 years. So cost of acquiring an asset is
spread over the estimated life of the assets. This is called
Depreciation.
Straight Line Method, Written Down method, Declining method
Sum-of the Years’ digit Method are the Deprecation Methods.
Most commonly used are Straight Line & WDV Methods.
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