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  3. Study Set
    Intermediate Accounting Reporting and Analysis Study Set 1
  4. Exam
    Exam 11: Depreciation, Depletion, Impairment, and Disposal
  5. Question
    The Purpose of Depreciation Is to Allocate the Asset's Cost
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The Purpose of Depreciation Is to Allocate the Asset's Cost

Question 1

Question 1

True/False

The purpose of depreciation is to allocate the asset's cost systematically and rationally over the life of the asset to ensure that the company has adequate capital for future replacement.

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