The payment of salaries of $500,000 and $25,000 in income tax last year by Dream Ice Cream Company would be classified as operating activities in preparing the company's cash flow statement.
The cash flow statement or statement of cash flows is one of the basic financial statements, including the income statement and the balance sheet.
The cash flow statement summarizes the cash inflows and outflows, reflecting changes in the balance sheet accounts and the income statement.
In preparing the cash flow statement, there are three main categories: operating activities, financing activities, and investing activities.
Thus, the operating activities section details cash movements with regard to the company's core activities of producing, marketing, and distributing goods and services to customers.
Learn about the operating activities section of the cash flow statement at https://brainly.com/question/28479430
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