Allocation of the historic costs of fixed assets against the annual revenue they generate is called
A) net profits.
B) gross profits.
C) depreciation.
D) amortization.

Question

Quizplus · Accepted Answer

This is because the definition given in the question matches with the definition of depreciation. Depreciation refers to the systematic allocation of the cost of a fixed asset over its useful life against the revenues it generates during that period. Net profits and gross profits are measures of a company's profitability and do not involve the allocation of fixed asset costs. Amortization also refers to the allocation of costs, but specifically for intangible assets like patents or copyrights.

Allocation of the Historic Costs of Fixed Assets Against the Annual