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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › Cash flow statement
Hi sir,
Why the interest paid is deducted from operating activities instead of deducting from financing activities.
The easy answer is because that is what is stated in the Accounting Standard!
It is because interest and dividends are paid out of the operating profits and so reduce the cash available from operating activities.
Thank u so much.
You are welcome 🙂