Buffett Company experienced an accounting event that affected its financial statements as indicated below: Which of the following accounting events could have caused these effects on Buffett's statements?
A)Recognized depletion expense under the units-of-production method.
B)Recognized depreciation expense under the double declining balance method.
C)Amortized patent cost under the straight-line method.
D)Any of these.

Question

Buffett Company experienced an accounting event that affected its financial statements as indicated below:  Which of the following accounting events could have caused these effects on Buffett's statements?
A)Recognized depletion expense under the units-of-production method. 
B)Recognized depreciation expense under the double declining balance method. 
C)Amortized patent cost under the straight-line method. 
D)Any of these.

Quizplus · Accepted Answer

Depletion expense, amortization expense, and depreciation expense all decrease assets and increase expenses, which decreases net income and equity, and do not affect cash flows.

Buffett Company Experienced an Accounting Event That Affected Its Financial