a-company-pays-10000-in-interest-and-40000-in-principal-on-a-note-payable-how-sh

Question

A company pays $10,000 in interest and $40,000 in principal on a note payable. How should these payments be classified in the cash flow statement?

Accepted Answer

$40,000 as financing activity; $10,000 as operating activity

Answer

$50,000 as financing activity

Answer

$10,000 as financing activity; $40,000 as operating activity

Answer

$50,000 as operating activity

A company pays \$10,000 in interest and \$40,000 in principal on a note payable. How should these payments be classified in the cash flow statement?