Depreciation is reported as an expense on the firm's income statement, but does NOT involve any actual cash.

Name: Depreciation is reported as an expense on the firm's income statement, but does NOT involve any actual cash.
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Question

Quizplus · Accepted Answer

Depreciation is a non-cash expense that is recorded on the income statement to allocate the cost of a fixed asset over its useful life. It reduces the value of the asset on the balance sheet but does not involve any actual cash outflow.

Depreciation Is Reported as an Expense on the Firm's Income