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How do you treat depreciation in calculating cash flow from operating activities?

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Question

How do you treat depreciation in calculating cash flow from operating activities?

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Solution

Depreciation is treated as a non-cash expense. It is shown as an adjustment to net profit in the Cash Flow from Operating Activities section when using the indirect method.

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Chapter 15: Project Work - PROJECT WORK PROBLEMS [Page P-43]

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D. K. Goel Accountancy Part 1 and 2 [English] Class 12 ISC
Chapter 15 Project Work
PROJECT WORK PROBLEMS | Q 4. | Page P-43
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