Under the direct method of preparing the financing section of the statement of cash flows,net cash provided by financing activities is $388,000.If the indirect method of preparing the statement of cash flows was used:
A)net cash provided by financing activities would be less than $388,000.
B)net cash provided by financing activities would be more than $388,000.
C)net cash provided by financing activities would be the same,$388,000.
D)net cash provided by operating activities would equal $388,000.

Question

Quizplus · Accepted Answer

The amount of net cash provided by financing activities would be the same under both the direct and indirect methods of preparing the statement of cash flows. The difference between the two methods is how the cash flows are presented, but the total amount should be the same. Therefore, the correct answer is C.

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