Depreciation ampunt rteg

This discussion clarifies the accounting treatment of depreciation. It explains that depreciation is deducted before calculating Profit & Loss (P&L), and the resulting P&L is then transferred to the Capital account or Reserve & Surplus. Crucially, depreciation is a non-cash expense, meaning it reduces the asset's value on the balance sheet but doesn't involve an outflow of cash at the time of the expense recognition.