Because amortization is treated as a separate source of cash, only net rather than gross changes in fixed assets appear on the statement of cash flows.

Question

Quizplus · Accepted Answer

Amortization is a non-cash expense, and it is added back to net income in the operating activities section of the cash flow statement, not treated as a separate source of cash. Gross changes in fixed assets are reflected in the investing activities section.

Because Amortization Is Treated as a Separate Source of Cash