Final answer:
In the indirect method statement of cash flows, the interest expense is added back to the net income in the operating section, as it is a non-cash expense that does not represent a cash outflow during the period. Therefore, the correct answer is b) Interest expense.
Step-by-step explanation:
The student asked which line item would be included in the operating section of Panjim's 2015 indirect method statement of cash flows given an interest expense of $6,000 for 2015. In the indirect method statement of cash flows, the operating section starts with net income and then adjustments are made for changes in working capital and non-cash expenses to arrive at the net cash provided by operating activities.
Interest expense is a non-cash expense that is typically added back to net income in the operating activities section because it is expensed on the income statement but does not represent an outflow of cash during the period. Therefore, the correct line item from the options provided that would be included in the operating section is b) Interest expense.