Which of the following statements is FALSE?
A)The income statement is put together at a specific point in time (end of a business quarter,or business year)and so the sale could be in one period and the cash received in another period.
B)The income statement contains the set of expenses associated with the products or services sold during the current operating period,with those expenses not associated with current cash flow labeled as non-cash expense items.
C)In almost all circumstances depreciation is a current expense of a cash outflow in the current period.
D)Companies depreciate fixed assets (such as office furniture,equipment,machinery,and buildings)over an assigned time period,but the initial cash outlay for the fixed asset typically occurs at the time the asset is acquired by the firm.

Question

Quizplus · Accepted Answer

Depreciation is not a cash outflow in the current period. It is a non-cash expense item that decreases the value of fixed assets over time. This statement is false, as it suggests that depreciation is always a current expense of cash outflow.

Which of the Following Statements Is FALSE