The loss resulting from a company writing down the value of an asset is a(n):
A) cash flow for investing.
B) increase in accumulated depreciation for the asset.
C) non-cash adjustment on the statement of cash flows.

Question

Quizplus · Accepted Answer

The loss from writing down the value of an asset is considered a non-cash adjustment because it affects the company's financial statements but does not involve any immediate cash outflow. It is reflected in the statement of cash flows to reconcile net income with cash generated from operating activities.

The Loss Resulting from a Company Writing Down the Value