In Order to Accurately Estimate Cash Flow from Operations, Depreciation

question 18

True/False

In order to accurately estimate cash flow from operations, depreciation must be added back to net income. The reason for this is that even though depreciation is deducted from revenue it is really a non-cash charge.

---

Definitions:

Display

To show or exhibit something, often for the purpose of demonstration, presentation, or entertainment.

Bonds

Financial instruments representing a loan made by an investor to a borrower, typically corporate or governmental.

Increased Levels

Generally refers to a rise or escalation in the quantity, intensity, or degree of a specific variable or condition.

Independence

The state or quality of being self-sufficient and not reliant on external support or aid.