Accumulated Depreciation

Accumulated depreciation refers to the total depreciation expense that has been recorded over the useful life of a tangible asset since its acquisition.

Depreciation is the systematic allocation of the cost of an asset over time to reflect its diminishing value and wear and tear. The accumulated depreciation account is a contra-asset account, deducted from the original cost of the asset on the balance sheet. It represents the portion of the asset's value that has been expensed or allocated, providing a more accurate representation of the asset's current value. 

Imagine you buy a computer for your business. As it gets older and used, it loses value due to wear and tear. Accumulated depreciation is the total amount we've subtracted from the original cost of the computer to show how much it has depreciated or lost value.

It helps us see the item's current worth more accurately on our financial records. So, it's like a running tally of the wear and tear expenses we've accounted for since we first got the item.