On a statement of cash flows, repayment of long-term debt is considered:
A) an operating activity.
B) an investing activity.
C) a financing activity.
D) a change in operating assets and liabilities.

Question

Quizplus · Accepted Answer

Repayment of long-term debt is a financing activity because it involves paying back borrowed funds to creditors. Financing activities involve transactions that affect the company's equity and long-term liabilities, such as borrowing money, repaying debt, and paying dividends.

On a Statement of Cash Flows, Repayment of Long-Term Debt