Since the life of equipment has been extended to 10 years, the years of life should be taken to calculate current year depreciation is 10 years.
Depreciation is an accounting method for allocating the cost of a tangible or physical asset over its useful life. Depreciation is a measure of how much of an asset's value has been consumed. It enables businesses to generate revenue from assets they own by paying for them over time.
The immediate cost of ownership is significantly reduced because companies do not have to account for them entirely in the year the assets are purchased. Accounting for depreciation incorrectly can have a significant impact on a company's profits. Long-term assets can also be depreciated for tax and accounting purposes.
Depreciation can be contrasted with amortization, which accounts for the change in value of intangible assets over time.
Learn more about depreciation here:
https://brainly.com/question/14861580
#SPJ4
