What Effect Does Depreciating a Long-Term Asset Have on the Financial

Multiple Choice

What effect does depreciating a long-term asset have on the financial statements?

A) Depreciation causes a decrease in net income on the income statement and a decrease in total assets on the balance sheet.
B) Depreciation is reported as an operating activity cash outflow.
C) Depreciation is reported as an investing activity cash outflow.
D) Depreciation is reported on the statement of changes in shareholders' equity.