Glossary
Amortization
Amortisation is spreading the cost of an intangible asset, like a licence or software, or a loan, over the years of its use or repayment.
What it means for a shop owner
It is the sibling of depreciation for things you cannot touch. It moves part of the cost into expense each period. For a loan it means each instalment pays part of the principal and part of the interest.
A worked example
A software licence costs 3600 for 3 years. Amortisation is 1200 a year or 100 a month.
Related
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The free plan: the whole shop for one branch, an offline cashier with stock, debts and accounting, with a daily limit on invoices, expenses and purchase orders. What it includes