Amortization

The paying off of debt in regular installments over a period of time. The deduction of capital expenses over a specific period of time
Suppose Arshad Enterprise spent Rs 30 million on a piece of medical equipment and that the patent on the equipment lasts 15 years, this would mean that Rs 2million would be recorded each year as an amortization expense.While amortization and depreciation are often used interchangeably, technically this is an incorrect practice because amortization refers to intangible assets and depreciation refers to tangible assets.