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Interest paid and Received in the Cashflow Statement

220215y ago
Hello Tutor How is interest paid and how is interest received recorded in the cashflow statement when using the indirect method? Thanks!
John MoffatJohn MoffatTutor5y ago#1
I expand both in my free lectures on this. Interest paid appears under 'cash flows from operating activities'. Interest received appears under 'cash flows from investing activities'. The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
220215y ago#2
Hi Tutor thank you for helping clear this Can I ask why interest paid is under operating and interest received is under investing? Why are they both not classified the same thank you so much
John MoffatJohn MoffatTutor5y ago#3
Because they are two different things. One is a payment that has to be made out of the profits, the other is income from investing.
220215y ago#4
Hello Tutor Thank you so much for the help, I got it
John MoffatJohn MoffatTutor5y ago#5
You are welcome :-)
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