In preparing a statement of cash flows the issuance of debt should be reported separately from the retirement of debt.

Question

Quizplus · Accepted Answer

The issuance of debt and the retirement of debt are two separate transactions that should be reported separately in the statement of cash flows. The issuance of debt represents a cash inflow, while the retirement of debt represents a cash outflow, and both should be disclosed separately for transparency and clarity in the statement of cash flows.

In Preparing a Statement of Cash Flows the Issuance of Debt