ACCA FR · Chapter 14 · Question 6 of 15
Under IAS 7, where may dividends paid to the entity's shareholders be presented in the statement of cash flows?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) In either operating activities or financing activities, applied consistently
Explanation
IAS 7 allows dividends paid to be classified as financing cash flows, because they are a cost of obtaining finance, or as operating cash flows, so users can judge whether operating cash flows can cover dividends. The chosen classification must be applied consistently.
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