Interest Expense Appears in the Operations Section of the Statement

question 57

Multiple Choice

Interest expense appears in the operations section of the statement of cash flows because:

• A)firms cannot operate without incurring interest expense.
• B)its payment is not within managerial discretion.
• C)it is paid to finance a firm's inventory.
• D)None of these; interest expense appears in the financing section of the statement of cash flows.

---

Definitions:

Labor Hours

The total number of work hours spent by employees on a given task or project.

Objective Function

Describes the formula or model that a decision-making process seeks to optimize.

Minimize Cost

The process of finding the strategy or path that leads to the lowest possible cost while satisfying all constraints and meeting all requirements.

Wholesale Cost

The price charged for goods and services when sold in large quantities for resale by the purchaser.