Under the direct method of preparing the operating section of the statement of cash flows, net cash provided by financing activities is $498,000. If the indirect method of preparing the statement of cash flows was used:
A)net cash provided by financing activities would be less than $498,000.
B)net cash provided by financing activities would be more than $498,000.
C)net cash provided by financing activities would be the same, $498,000.
D)net cash provided by operating activities would equal $498,000.

Question

Quizplus · Accepted Answer

The method used (direct or indirect) affects only the operating activities section, not the financing activities section. Therefore, net cash provided by financing activities remains the same.

Under the Direct Method of Preparing the Operating Section of the Statement