The correct answer is C. Loss of equipment over time due to wear and tear.
Depreciation is the decrease in the value of an asset over time due to wear and tear, obsolescence, and other factors. It is a non-cash expense that is recorded on the income statement to account for the decline in the value of an asset.
Option A is incorrect because a lock-out is a situation in which an employer refuses to allow employees to work. This would not cause the equipment to depreciate.
Option B is incorrect because labor trouble is a situation in which employees are striking or otherwise protesting against their employer. This would not cause the equipment to depreciate.
Option D is incorrect because a fire accident would cause the equipment to be destroyed, not depreciate.
Depreciation is an important concept in accounting because it allows businesses to account for the decline in the value of their assets over time. This is important for both financial reporting and tax purposes.