When to adjust depreciation while doing cashflow sums?
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hey mate ☺️☺️
In the operating activities section of the cash flow statement, add back expenses that did not require the use of cash. Examples are depreciation, depletion, and amortization expense. Let's illustrate how a depreciation expense is handled by continuing with the Good Deal Co.
If depreciation is an allowable expense for the purposes of calculating taxable income, then its presence reduces the amount of tax that a company must pay. Thus, depreciation affects cash flow by reducing the amount of cash a business must pay in income taxes.
In the operating activities section of the cash flow statement, add back expenses that did not require the use of cash. Examples are depreciation, depletion, and amortization expense. Let's illustrate how a depreciation expense is handled by continuing with the Good Deal Co.
If depreciation is an allowable expense for the purposes of calculating taxable income, then its presence reduces the amount of tax that a company must pay. Thus, depreciation affects cash flow by reducing the amount of cash a business must pay in income taxes.
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sorry to say but I can't help you mate bcoz I don't know the answer properly
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