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A. Valuation
B. Valuation and allocation
C. Allocation
D. Appropriation

AS-6 on depreciation accounting defines ‗depreciation‘ as the measure of wearing out, consumption or other loss of a value of a depreciable asset arising from use, effluxion of time or obsolescence through technology and market changes. Depreciation is allocated so as to charge a fair proportion of the depreciable amount in each accounting period during the expected useful life of the asset. Depreciation includes amortization of assets whose useful life is predetermined.

Correct Answer: Allocation

Last Updated: August 10, 2017