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Statement I : In case of… (Class 12 Accountancy 2026, Q28)

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AccountancyCBSE Class 12 · Board exam 2026, set 67/5/1 · 1 mark · MCQ

CBSE Class 12 Accountancy 2026: question 28

Set in the CBSE Class 12 board exam of 2026, paper 67/5/1, section B-I, question 28, for 1 mark. Try it first; the hints and our step-by-step solution are below.

Q28 · 1 mark · MCQCash Flow Statement

Statement I : In case of non-financial enterprises, payment of interest and dividend are classified as financing activities.
Statement II : In case of financial enterprises, payment of interest and dividend are classified as investing activities.
Choose the correct option from the following :

  1. (A)Both the statements are true.
  2. (B)Both the statements are false.
  3. (C)Statement I is true, but Statement II is false.
  4. (D)Statement I is false, but Statement II is true.

Source: official question paper from cbse.gov.in (PDF). See it in the full 2026 board paper, set 67/5/1.

Hints

Open one hint at a time and try again before the next.

Hint 1

Paying interest and dividend is about the cost of finance.

Hint 2

Does any enterprise treat a payment of dividend as investing?

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. For a non-financial enterprise, interest and dividend paid are costs of raising finance, so they are financing activities: Statement I is true.

  2. For a financial enterprise, interest paid is an operating activity, and dividend paid stays financing; neither is investing. Statement II is false. Option (C).

    1 mark

Answer: (C) Statement I is true, but Statement II is false

Where the marks are

  • Classifies interest and dividend paid correctly for both kinds of enterprise (1 mark)

Revise the chapter

Practise this chapterBoard-style questions from Cash Flow Statement, one at a time, marked against the answer key and marking points.Back to the full paper2026 board paper, set 67/5/1: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.