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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? What is its dollar amount?

A. $740
B. $1,282
C. $2,351
D. $1,611
E. $2,893

Respuesta :

Answer:

D. $1,611

Explanation:

Depreciation is an expense indicating a decline in the value of the capital assets due to tear and wear, obsolescence, usage, time span, etc. It's displayed on the income statement debit side. It is a non-cash item which has no impact on the cash balance.

So in the given case, the non cash expense is known as depreciation expense

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