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WAEC Financial Accounting 2007 Question 21

Question 21

Depreciation

Which of the following is not a cause of depreciation?

  1. A.Inflation
  2. B.Erosion and decay
  3. C.Wear and tear
  4. D.Obsolescence.
Show the answer and explanation

Answer: A (Inflation)

Explanation

Inflation changes prices, not the asset's use or life.