Depreciation

question 26

Multiple Choice

Depreciation

• A)reduces both the net fixed assets and the costs of a firm.
• B)decreases net fixed assets,net income,and operating cash flows.
• C)is a noncash expense that decreases the selling,general,and administrative expenses.
• D)is a noncash expense that reduces the pretax income.
• E)increases the net fixed assets as shown on the balance sheet.

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Definitions:

Buying

The process of acquiring goods, services, or financial assets in exchange for money or other assets.

Relatively High Tax Brackets

Tax categories that are higher than average, typically applying to individuals or entities with significantly high income or profits.

Lessor Firms

Companies that lease or rent out assets or properties to others under a contractual agreement.

Lessee Firms

Companies that enter into lease agreements to rent assets or property rather than purchasing them outright.