Abiss company has erroneously skipped recording depreciation on one of its equipmentamounting to $25,000, in its income statement. The company is planning for an increase in thisdepreciation. On the financial statements of Abiss this willDecrease net cash flow from operations on the cash flow statement.b. Not impact the cash flow statementc. Increase in net cash flow from operations on the cash flow statementd. No impact the Income statement

Depreciation refers to the decrease in the value of the asset due to its normal wear and tear over a…

Abiss company has erroneously skipped recording depreciation on one of its equipmen amounting to $25,000, in its income statement. The company is planning for an increase in this depreciation. On the financial statements of Abiss this will a. Decrease net cash flow from operations on the cash flow statement. b. Not impact the cash flow statement c. Increase in net cash flow from operations on the cash flow statement d. No impact the Income statement

Abiss company has erroneously skipped recording depreciation on one of its equipmen amounting to $25,000, in its income statement. The company is planning for an increase in this depreciation. On the financial statements of Abiss this will a. Decrease net cash flow from operations on the cash flow statement. b. Not impact the cash flow statement c. Increase in net cash flow from operations on the cash flow statement d. No impact the Income statement

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Depreciation and amortization are added back in computing operating cash flows because: a They represent outflows that record the wear and tear on assets over their estimated useful lives, as per accounting principles. b They represent variable costs of production. c It is required under SEC guidelines. d Excess cash has been deducted in the income statement.
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