Paul Company's expected sales for April are $27,600.Other information follows:
$\begin{array}{ll}\text { Budgeted Operating Expenses }&\text { Amount }\
\text { Wages } & \$ 2,000 \
\text { Advertising } & 1,680 \
\text { Patent amortization } & 1,440 \
\text { Rent } & 2,560 \
\text { Marketing } & 5 \% \text { of sales }
\end{array}$
Which of the following operating expenses is a noncash expense?
A) Advertising
B) Rent
C) Patent amortization
D) Wages

Question

Quizplus · Accepted Answer

Patent amortization is a noncash expense because it represents the systematic allocation of the cost of a patent over its useful life, rather than an actual cash outflow.

Paul Company's Expected Sales for April Are $27,600 Which of the Following Operating Expenses Is a Noncash Expense