If a company borrows money from a bank, the interest paid should be reported on the statement of cash flows as an):
A) Financing activity.
B) Operating activity.
C) Investing activity.
D) Noncash investing and financing activity.
E) Cannot be determined from the information given.

Question

Quizplus · Accepted Answer

Interest paid is classified as an operating activity on the statement of cash flows according to the indirect method under U.S. GAAP.

If a Company Borrows Money from a Bank, the Interest