Start networking and exchanging professional insights

Register now or log in to join your professional community.

Follow

In a statement of cash flows (indirect method), depreciation expense should be presented as:

a) an addition to net income

b) a deduction from net income

c) a cash flow from financing activities

d) a cash flow from investing activities

user-image
Question added by Mir Mujtaba Ali , Internal Audit Manager , Confidential
Date Posted: 2015/02/07
Divyesh Patel
by Divyesh Patel , Assistant Professional Officer- Treasury , City Of Cape Town

My answer is option A- an addition to net income. Thank you.

VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
by VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

Option (a)   >>>>>>>>>>>>>>>>     an addition to net income

Ahmed kandil
by Ahmed kandil , Cost Controller , Battour Holding Cpompany

answer A is the correct answer because this expense is non -cash  

Sara Khan
by Sara Khan , financial and admin assistant , Ministry Of Defence

Agreed with Sir Suprio ghosh.

Tanveer Qureshi
by Tanveer Qureshi , Director , Qureshi Associates

Option-A is appropriate answer.

Deleted user
by Deleted user

Answer A is the correct answer it will be added to net income to remove its effect to net income because depreciation expense is non-cash item .

Syed Hyder
by Syed Hyder , Assistant Manager–Commercial Finance (Inventory & Payables) , Daraz.pk (Ali Baba Venture)

Addition to Net income i.e option A

 

Fawzy Ahmed Salim El-Shabiby
by Fawzy Ahmed Salim El-Shabiby , Accountant , Servtel Information, Security, and Telecommunication Network Limited

Ans: (A) it will be an addition to net income

Abd ElRahman Mohammed Idris Mohammed
by Abd ElRahman Mohammed Idris Mohammed , Internal Audit Manager , Kenana Sugar Company Limited

(A) should be presented as an addition to net income.

Muhammad Waqas Lokhandwala
by Muhammad Waqas Lokhandwala , Auditor , MSK International Auditors

In indirect method they would be treated as addition to net income

The answer is (a)

ALI JAFFAR
by ALI JAFFAR , Accountant , Yuksel Saudia

a cash flow from investing activities