CAF-1 · Chapter 14 · Question 11 of 15
How are interest paid and interest received typically classified in a statement of cash flows?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) They must be disclosed separately and classified consistently (e.g., interest paid as operating/financing, interest received as operating/investing).
Explanation
IAS 7 requires interest paid and received to be disclosed separately. They can be classified as operating, investing, or financing depending on the entity's policy, applied consistently.
More IAS 7 Statement of Cash Flows MCQs
- Q13A company pays a dividend to its shareholders. Under IAS 7, this cash outflow is typically classified as:
- Q14Under the indirect method, how is depreciation expense treated when calculating cash generated from operations?
- Q15When preparing a cash flow statement, an entity discovers it has a 45-day treasury bill. How should this be classified?
- Q1Under IAS 7, how are 'cash equivalents' defined?
- Q2Which of the following activities is classified as an 'Operating Activity' under IAS 7?