Final answer:
False. Accrued interest expense will not appear on the income statement, but it will appear on the statement of cash flows.
Step-by-step explanation:
Accrued interest expense will not appear on the income statement, but it will appear on the statement of cash flows. Therefore, the statement is False.
The income statement reports a company's revenues, expenses, and profits or losses for a specific period. Accrued interest expense represents the interest that has been incurred but has not yet been paid. Since it is an expense, it should be recorded on the income statement.
The statement of cash flows, on the other hand, shows the cash inflows and outflows from operating, investing, and financing activities. Accrued interest expense affects cash flows because it represents an obligation to pay in the future. Therefore, it should be included in the operating activities section of the statement of cash flows.