Process of allocating cost of a capital
asset to amortization expense over the asset’s estimated useful
life. All capital assets wear out or decline in usefulness
and value as they become aged and are used, thus an amortization expense
must be recorded. Accounting amortization is the process of allocating
or matching the cost of capital assets over the time that they are used.
Cost of capital assets should be amortized over their useful lives by
one of the 3 prescribed accounting amortization methods described below.
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