Final answer:
'Payment on long-term debt' affects the statement of cash flows by reducing a company's cash position as it represents a cash outflow from financing activities.
Step-by-step explanation:
'Payment on long-term debt' refers to the repayment of principal and interest on loans or bonds that have a maturity of more than one year. In the context of the statement of cash flows, 'Payment on long-term debt' is classified as a cash outflow from financing activities. This means that when a company makes payments towards its long-term debts, it reduces its cash position and is reflected as a decrease in the 'Cash' line item on the statement of cash flows.
For example, if a company has a long-term loan with scheduled interest and principal payments, the cash outflows made to fulfill these obligations would be reported under 'Payment on long-term debt' on the statement of cash flows. These payments can have a significant impact on a company's cash position and overall financial health.