The 2016 financial statements for Leggett & Platt, Inc., report the following information:  Year ended December 31, 2016 2015 (In millions)     Depreciation expense $     86.8 $     83.5 Property and equipment, net 565.5 540.8 Land 37.7 40.0 Accumulated depreciation 1,165.4 1,146.5 Which of the following estimates the property and equipment's percent-used-up at December 31, 2016?   A. 68.8%   B. 45.4%   C. 16.9%   D. 42.3%   E. None of the above

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Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.