Interest Expense Appears in the Operations Section of the Cash-Flow

question 26

Multiple Choice

Interest expense appears in the operations section of the cash-flow statement 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 cash-flow statement

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Definitions:

Special Revenue Fund

A fund used by a government to account for revenue from specific sources that are legally restricted to expenditure for particular purposes.