The recognition of depreciation expense acts to:
A) Decrease assets, stockholders' equity, and cash flow from operating activities.
B) Increase cash flow from operating activities, and does not affect the amount of total assets.
C) Increase assets, stockholders' equity, and cash flow from operating activities.
D) Decrease assets and stockholders' equity, and does not affect cash flow.

Question

Quizplus · Accepted Answer

Depreciation expense is a non-cash expense that reduces the value of fixed assets over its expected useful life. Therefore, it decreases the assets and stockholders' equity on the balance sheet but does not affect cash flow.

The Recognition of Depreciation Expense Acts To