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depreciation expense is ______ net income in a statement of cash flows prepared using the indirect method because it ______.

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Depreciation expense is added to net income in a statement of cash flows prepared using the indirect method

Depreciation expense is allocated portion of cost shown on the income statement that reduces the company's net income. It is considered as a non cash expense, hence it is added to the net income in a statement of cash flows.

Net income is used to measure cash flows from operating activities, hence depreciation expense must be added back to net income when using indirect method.

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