Fixed assets are gradually worn out in the production process until they are scrapped, and their value is transferred to the product one by one with the wear and tear, and is recycled after the product is sold. The value of the portion of the fixed asset that is transferred to the product due to wear is called depreciation. The value of the portion of a fixed asset that is transferred to the product in currency is called a depreciation charge. The sum of depreciation, called depreciation fund. Depreciation funds can be divided into basic depreciation funds and major repair depreciation funds. The basic depreciation fund is mainly used for the repurchase and renewal of fixed assets. The overhaul depreciation fund is mainly used for the repair of fixed assets in order to restore its use value.
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