Depreciation is a false cost, why?

First a definition. Depreciation is the allocation of an asset's cost over it's useful ECONOMIC life. It is called a false cost because is Depreciation itself is nothing more than an estimate. There are several ways in which an asset may be depreciated (or expensed) but each is merely an estimate.

Its' advantage is that it more nearly allocates the cost of the fixed asset across the number of periods that will benefit economically from having it.

If you bought a Truck in 2009, and the Truck was expected to have an "useful economic life" of, say 3 years; it would be a gross error to charge 100% of the truck to the first period that it was in use. It would overstate expenses in year one, and understate expense in year two & three. Profit would be misstated in each of the three years.

CHECK SOURCES

Because money hasn't changed hands, yet.