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QWhich of the following expenses does not affect your cash position in running a business:
ID: #24247
Elements of Accounting
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Question Info
#24247Q ID
EasyDifficulty
Elements of AccountingTopic
Your Answer
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Correct Answer: Option C
Explanation
The correct answer is:
C. Depreciation Expense ✅
👉 Explanation:
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Depreciation is a non-cash expense.
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It represents the allocation of the cost of a fixed asset over its useful life.
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No actual cash leaves the business when depreciation is recorded.
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Lease Expense and Advertising Expense involve actual cash payments, so they reduce cash.
💡 Key point:
Non-cash expenses like Depreciation, Amortization, and Provisions affect profit but not the cash position.
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