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Question
Fixed assets lose part of their value every year due to wear and tear with passage of time, such reduction is called ______ on fixed assets.
Options
depreciation
deduction
production
none of these
Solution
Fixed assets lose part of their value every year due to wear and tear with passage of time, such reduction is called depreciation on fixed assets.
Explanation:
Fixed assets lose part of their value every year due to wear and tear and even with passage of time. Such reduction in value is called depreciation and it is treated as a revenue expense.
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