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Depreciation and Amortization in Financial Modeling

Best for: Financial Analyst, Investment Banker, Private Equity Associate, Fund Manager, Credit Analyst.

Depreciation and amortization are important accounting concepts that affect a company's financial statements. Depreciation refers to the allocation of the cost of a tangible asset over its useful life, while amortization refers to the allocation of the cost of an intangible asset over its useful life. When building a financial model, it is important to account for depreciation and amortization, as these expenses can have a significant impact on the company's financial performance. This prompt will help you understand how to account for depreciation and amortization in a financial model.

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