Depreciation among the expenses


It is sometimes claimed that to include depreciation among the expenses and to provide money out of earnings to retire bonds that were used to finance the acquisition of the assets being depreciated is to overcharge the current generation of customers. Through retiring the debt, the customers are paying for the old plant, and through depreciation charges they are paying for a new plant. Is this claim correct? Explain.

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Accounting Basics: Depreciation among the expenses
Reference No:- TGS048679

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