Which One of the Following Is a Non-Cash Item

question 219

Multiple Choice

Which one of the following is a non-cash item?

• A) Down payment on a building.
• B) Rent expense.
• C) Depreciation of equipment.
• D) Payroll tax expense.
• E) Company provided health insurance.

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Definitions:

Inventory Value

The total cost or market value of all the goods and materials held by a company for the purpose of resale or production.

Market Decline

A decrease in the overall value of a market, evidenced by falling asset prices and often associated with economic downturns.

Inventory Valuation

A process used to determine the cost associated with an inventory at the end of a financial period, affecting the cost of goods sold and net income.

Average Cost Method

An inventory valuation method that calculates the cost of goods sold and ending inventory based on the weighted average cost of all items available for sale.