Amortization in the income statement is an accounting practice that distributes the cost of acquiring long-term assets over a period of time, rather than recording it all at once. This practice allows companies to spread out the expense instead of having a large hit to the balance sheet. For example, if a company purchases a piece of equipment for $50,000 and will use it for 5 years, the amortization amount would be an even $10,000 each year over the five-year period. This helps businesses budget their expenses more accurately.