_____ occurs due to obsolescence that causes an asset to no longer provide services for which it was intended.
A) Physical depreciation
B) Effective depreciation
C) Accelerated depreciation
D) Functional depreciation

Question

Quizplus · Accepted Answer

Functional depreciation occurs when an asset is no longer able to provide the intended level of service due to obsolescence. This is different from physical depreciation, which is the reduction in the value of an asset due to wear and tear, and accelerated depreciation, which is a depreciation method where the asset is assumed to lose value at a faster rate in the early years of its life. Effective depreciation is not a commonly used term in accounting or finance.

_____ Occurs Due to Obsolescence That Causes an Asset to No