interest payable will increase the cash as if actually cash paid then it will reduce the cash but delayed in cash payment increase the cash for other purposes.
it is shown with changes in accounts payable amount if there is change in accounts payable it will shown in cash flow statement.
Increase in accounts payable means increase in cash as if cash was paid there was no increase in accounts payable but as no payment done it saves the cash and causes the increase in actual cash.
Debit interest on drawingsCredit interest payable / cash
cash
Increase in interest payable increases the cash flow of company as payment is not cleared when due and which causes temporary increase in company's cash flow
Decrease in accounts payable is shown as a decrease in cash under cash flows from operating activities because cash goes out when we pay the accounts payable.
Cash dividend affects the cash and remaining items does not have any effect on cash like depreciation or accounts payable.
cash flow statement don't show the sales but changes in accounts receivable and payable are shown in it.
Company has paid 2000 cash for interest due to which interest payable reduced by 2000.
Notes Payable - I hope that wasn't for an exam.
[Debit] Interest expense xxxx [Credit] Interest payable xxxx [Debit] Interest payable xxxx [Credit] Cash / bank xxxx
No it must be a fund flow statement