Since depreciation and other non-cash charges represent a scheduled write-off of an earlier cash outflow, they should NOT be included in the cash budget.

Question

Quizplus · Accepted Answer

Depreciation and other non-cash charges do not affect cash inflows or outflows, as they are not actual cash transactions. Therefore, they should not be included in the cash budget, which only considers the actual cash flows entering and leaving the company.

Since Depreciation and Other Non-Cash Charges Represent a Scheduled Write-Off