Depreciation Affects Profit in Which of the Following Ways

question 20

Multiple Choice

Depreciation affects profit in which of the following ways?

• A) Decreases profit, because it decreases a non-current asset.
• B) Increases profit, because it is an acquisition of a non-current asset.
• C) Profit decreases, because depreciation is an expense item.
• D) Profit does not change, because depreciation is a non-cash expense.

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Definitions:

Sequencing

The process of organizing or arranging items, actions, or events in a specific order.

Dispatching

The process of sending off goods or a workforce to their destination or for a specific task.

Production Steps

The series of phases or actions taken to manufacture a product, from raw materials to the final goods.

Forward Scheduling

A planning method that starts from a particular date and moves forward in time to determine the timeline for project or production activities.