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Cashflow

This topic has 3 replies, 2 voices, and was last updated 1 year ago by John Moffat.

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October 15, 2021 at 6:32 am #637717
James124
Participant
- Topics: 159
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In cashflows, we subtract interest paid in Cash from operating activities. Shouldn’t it be subtracted in cash from financing activities?
October 15, 2021 at 8:22 am #637739
John Moffat
Keymaster
- Topics: 56
- Replies: 51560
No, it should be as in the pro forma taken from IAS7 that is printed in our free lecture notes.
October 15, 2021 at 10:46 am #637746
James124
Participant
- Topics: 159
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Yes tutor. Can you please help me out why that so? Is there any reason or it is only as per standard?
October 15, 2021 at 4:01 pm #637762
John Moffat
Keymaster
- Topics: 56
- Replies: 51560
It is an expense like any other expense. However because it is different than other running expenses, it is required to be shown separately as a deduction.
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