18.2 - Causes of Depreciation
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Practice Questions
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Define wear and tear in your own words.
💡 Hint: Think about how your personal items lose quality over time.
What does obsolescence mean?
💡 Hint: Consider electronics and how quickly they become old-fashioned.
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Interactive Quizzes
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What is the primary cause of depreciation due to usage?
💡 Hint: Think of the condition of shoes after long use.
True or False: Obsolescence occurs when an asset becomes outdated.
💡 Hint: Look at how quickly tech advances.
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Challenge Problems
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If a factory has machines that have endured heavy usage for five years, how would you assess their wear and tear for depreciation purposes?
💡 Hint: Use depreciation methods to evaluate value loss.
Analyze how companies could mitigate risks associated with obsolescence in their asset management strategies.
💡 Hint: Consider how tech firms keep releasing new versions.
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