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Question

Depreciation is a classic example of a .

A
cash expense
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B
cash income
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C
non-cash expense
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D
non-cash income
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Solution

The correct option is C non-cash expense
The most common example of a non-cash expense is depreciation. Depreciation expense is used to match better the expense of a long-term asset to the revenue it generates., where the cost of an asset is spread out over time even though the cash expense occurred all at once.

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