Which of the following items is (are)difficult to classify clearly in one of the three sections of the statement of cash flows?

Question

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All three items are difficult to classify clearly because they can be considered either operating or financing activities depending on the specific circumstances. For example, interest paid can be considered an operating activity if it relates to interest on operating liabilities (such as accounts payable), but it can also be considered a financing activity if it relates to interest on debt financing. Similarly, dividends paid can be considered a financing activity if they relate to shareholders' equity, but they can also be considered an operating activity if they relate to preferred stock dividends that are treated as operating expenses. Taxes paid can be considered an operating activity if they relate to income taxes, but they can also be considered a financing activity if they relate to taxes on financing activities (such as taxes on interest income or dividends received).

Which of the Following Items Is (Are)difficult to Classify Clearly