Recording depreciation:
A) decreases liability and cash flow.
B) decreases net income but has no effect on cash flows.
C) decreases capital and operating expense.
D) decreases retained earning but has no effect on fixed assets.

Question

Quizplus · Accepted Answer

Recording depreciation decreases the value of assets over time, which in turn reduces net income. However, it has no direct effect on cash flows as it is a non-cash expense.

Recording Depreciation