An example of a cash flow related to a liability that would not appear in the financing activities category of the statement of cash flows is
A) mortgage payable.
B) bonds payable.
C) deferred income taxes.
D) a lease obligation.

Question

Quizplus · Accepted Answer

Deferred income taxes are related to income tax accounting and are classified under operating activities in the statement of cash flows, not under financing activities. Financing activities typically include transactions involving debt, equity, and dividends.

An Example of a Cash Flow Related to a Liability