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ACC Corporation's income statement shows depreciation of $1,611, sales of $21,415, interest paid of $1,282, net income of $1,374, and costs of goods sold of $16,408. Finance analysts would immediately identify one of these numbers as a so-called "noncash expense". Which one is it

Respuesta :

Answer:

Depreciation = $1,611

Explanation:

Here, the non-cash expense is depreciation of $1,611. All the other items such as interest expense, cost of goods sold, net income and sales are associated with the cash.

Depreciation is defined as the fall in the value of the fixed assets with the passage of time. It is determined on the following fixed assets:

(i) Machinery

(ii) Building

(iii) Equipment, etc.

The value of these assets reduced over time and that fall in the value is termed as the depreciation.

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