Tulip’s Flower Shop

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Tulip’s Flower Shop purchased a new van to use for delivering flowers. The van cost $40,000, and the store’s accountant believes the service life of the van will be 6 years. With this information, the accountant can now allocate the van’s cost over 6 years. This process is known as which of the following?

Adjustment

Depreciation

Estimation

Forecasting

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