Final answer:
The payment of dividends and changes in notes payable are classified as financing activities on the statement of cash flows, which accounts for transactions affecting a company's long-term liabilities and equity.
Step-by-step explanation:
The student asked about a statement from a chapter regarding the classification of certain financial activities. The payment of dividends and changes in notes payable are classified as financing activities. This classification is part of the statement of cash flows, which is a financial statement used to track the cash generated and used by a company during a specific period.
In finance, the statement of cash flows is divided into three main sections: operating activities, investing activities, and financing activities. Operating activities include the day-to-day transactions that affect net income, investing activities include transactions related to the acquisition or disposal of long-term assets, and financing activities relate to transactions that affect long-term liabilities and equity.
The payment of dividends represents cash outflows to shareholders and is considered a financing activity because it's a way the company returns value to its equity holders. Similarly, changes in notes payable are related to borrowing or repaying debt, which also falls under the banner of financing activities.