What Is Depreciation?

According to A. Tuovila (2021), depreciation is an accounting method for allocating a

tangible or physical asset's cost over its usable life or expected life. Depreciation is the
measurement of how much of an asset's value has been depleted over time.
Depreciating assets allows businesses to generate revenue while depreciating a
percentage of the asset's cost each year it is in use. It can have a significant impact on
profitability if it is not taken into account.

Long-term investments can be depreciated for both tax and accounting purposes.
Companies, for example, can claim a tax deduction for the asset's cost, lowering their
taxable income. The Internal Revenue Service (IRS) emphasizes, however, that
corporations must spread the cost out over time when depreciating assets. When a
company can take a deduction, the IRS has rules.

Depreciation is an accounting concept that allows a corporation to write off the value of
an asset over time, typically the asset's useful life. Machinery and equipment, for
example, are costly assets. Rather than recognizing the entire cost of an asset in the
first year, depreciation allows businesses to spread out that cost and create revenue.
Depreciation is a method of accounting for changes in the carrying value of a property
over time. The gap between the original cost and the cumulative depreciation over the
years is known as carrying value.

Reference: https://www.investopedia.com/terms/d/depreciation.asp