In Preparing the Statement of Cash Flows for Year 4

Multiple Choice

In preparing the statement of cash flows for Year 4, internal records indicate that depreciation on manufacturing facilities totaled $800.The firm included this amount in cost of goods sold in the income statement for Year 4.None of the of depreciation required an operating cash flow during Year 4.The T-account work sheet entry adds back the $800 of depreciation on manufacturing facilities.Accountants treat depreciation charges on manufacturing facilities as

A) a period expense.
B) an opportunity cost.
C) a product cost.
D) a cost of capital.
E) a marginal cost.