What type of depreciation occurs when an asset can no longer provide services at the level originally intended?
A)Physical depreciation
B)Market depreciation
C)Cost depreciation
D)Functional depreciation

Question

Quizplus · Accepted Answer

Functional depreciation refers to the decline in an asset's ability to provide services at the level originally intended, which can occur due to wear and tear or obsolescence. This type of depreciation is considered separate from physical or market depreciation, which are related to changes in the asset's physical condition or its perceived value in the marketplace, respectively. Cost depreciation is not a commonly used term in accounting or finance.

What Type of Depreciation Occurs When an Asset Can No