The statement of cash flows classifies cash used for interest expense as
A)an operating activity
B)an investing activity.
C)a financing activity.
D)an exchange activity.
E)a funds usage activity.

Question

Quizplus · Accepted Answer

Interest expense is classified as an operating activity because it is related to the core operations of a business, reflecting the cost of borrowing money which is considered part of the day-to-day operations.

The Statement of Cash Flows Classifies Cash Used for Interest