The loss of value due to physical wear and tear is known as what?

The loss of value due to physical wear and tear is termed depreciation. This concept is integral to accounting and property assessment, as it reflects the gradual reduction in value of an asset over time due to factors such as usage, neglect, or the passage of time itself.

When an asset, such as machinery or equipment, is used, its condition tends to deteriorate due to regular wear and tear, leading to a decrease in its market value. This process is systematic and can be calculated using various methods, such as straight-line or declining balance methods, which provide a means to quantify the depreciation over an asset's useful life.

In this context, the other terms do not accurately define the loss in value caused specifically by physical wear and tear. Obsolescence refers to a reduction in value due to outdated technology or changes in consumer preferences rather than physical deterioration. Amortization is usually applied to intangible assets, like patents or copyrights, rather than physical property. Impairment, while it does indicate a reduction in the value of an asset, typically refers to a significant decline in value due to unforeseen circumstances rather than the gradual process of wear and tear.