Question
A manufacturer of plastic bottles for the medical market has purchased a new compression blow molder for its bottleproduction plant. Which of the descriptions below
A manufacturer of plastic bottles for the medical market has purchased a new compression blow molder for its bottleproduction plant. Which of the descriptions below correctly identifies some of the relevant effects of this purchase on the firm's GAAP financial statements?
a. It will be depreciated over time on the income statement and therefore not be recorded separately on the statement of cash flows.
b. It will be depreciated over time on the income statement and subtracted as a capital expenditure on the statement of cash flows.
c. It will be depreciated over time on the income statement and subtracted as Inventory on the statement of cash flows.
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