180k views
3 votes
Your company buys a car and its value goes down over time. what is that process called

User Whitfiea
by
7.1k points

1 Answer

5 votes
This process is called depreciation. It is defined as the reduction of the value of an asset with time due to factors like wear and tear. The car, in this case, is very susceptible to wear and tear therefore it will really depreciate no matter what. Depreciation is one cost that should be included in any accounting of assets.
User Pieter Van Den Ham
by
7.8k points