Final answer:
Depreciation pertains to the process of allocating the cost of an asset over its lifespan, closely adhering to the matching principle of accounting, reducing taxable income, and impacting dividends. The correct statement regarding depreciation is that all answers presented -- not being a matter of valuation, being part of the matching principle, and retaining funds -- are correct.
Step-by-step explanation:
The topic of depreciation is integral to Business accounting. Depreciation is not merely about reducing the book value of an asset but is fundamental to the concept of matching revenues with expenses. To clarify the initial query, depreciation is indeed not a matter of valuation; rather, it represents the allocation of the cost of an asset over its useful life. Moreover, this process is directly tied to the matching principle in accounting, which aims to record expenses in the same period as the revenues they help to generate.
Furthermore, depreciation affects tax calculations. Since it is a non-cash expense, it lowers taxable income without affecting cash flow directly, leading to potential tax savings. It also affects the dividends since the reported net income is lower after accounting for depreciation, which may result in smaller dividend distributions, thus retaining more funds within the business.
In a broader financial context, evaluating the statements given, the correct option considering all aspects mentioned above is 'd. all of the answers are correct'.