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Why should depreciation be written on fixed assets?

Following are the reasons of providing depreciations on fixed assets:

  • To ascertain the true profit or loss of the business in an accounting period.

    How to create Fixed Asset Ledger Account in Tally.ERP 9 ...

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  • Presentation of true financial position of the business at the end of the accounting period.
  • To ascertain the profit or loss on sale of assets.
  • To give correct information to the creditors.
  • To facilitate fixation of prices of product.
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