On July 1, Year 1, Dewey Co. signed a 20-year building lease that it reported as a capital lease. Dewey paid the monthly lease payments when due. How should Dewey report the effect of the lease payments in the financing activities section of its Year 1 statement of cash flows?
A.	The lease payments should not be reported in the financing activities section.
B.	An outflow equal to the Year 1 principal payments only.
C.	An inflow equal to the present value of future lease payments at July 1, Year 1, less Year 1 principal and interest payments.
D.	An outflow equal to the Year 1 principal and interest payments on the lease.