Depreciation expense is always included in the cash budget as it reflects the impact of fixed asset purchases.

Question

Quizplus · Accepted Answer

Depreciation expense is a non-cash expense that reflects the reduction in value of fixed assets over time. It is not a cash outflow and therefore is not included in the cash budget. However, fixed asset purchases would be included in the cash budget as they represent a cash outflow.

Depreciation Expense Is Always Included in the Cash Budget as It