Multiple choice general knowledge

Depreciation is a?

  1. Asset

  2. Liability

  3. Non-cash item

  4. Cash item
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Depreciation is a non-cash expense because it represents the allocation of an asset's cost over its useful life, not an actual cash outflow. It's an accounting entry to spread the cost of tangible assets. Option C is correct. Depreciation is neither an asset nor a liability, and it's certainly not a cash item.

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