When using the indirect method to determine operating cash flows,how is depreciation expense recorded on the Statement of Cash Flows?
A)Operating activity
B)Investing activity
C)Financing activity
D)Noncash investing and financing activity
E)Not reported on the statement of cash flows

Question

Quizplus · Accepted Answer

Depreciation expense is added back to net income when using the indirect method to determine operating cash flows because it is a noncash expense. Therefore, it is included in the operating activities section of the statement of cash flows.

When Using the Indirect Method to Determine Operating Cash Flows,how