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Depreciation Is the Systematic Allocation of Historical Depreciable Cost to Periods

Question 28

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Depreciation is the systematic allocation of historical depreciable cost to periods in which an asset is used. Depreciation is not a cash outflow but does reduce reported income and thus retained earnings by the depreciable cost of the asset less the tax savings associated with depreciation.
Required:
Depreciation is the systematic allocation of historical depreciable cost to periods in which an asset is used. Depreciation is not a cash outflow but does reduce reported income and thus retained earnings by the depreciable cost of the asset less the tax savings associated with depreciation. Required:

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