Under the indirect method of preparing the statement of cash flows,the starting point to determine Net Cash Provided by Operating Activities is:
A)the beginning cash balance.
B)the ending cash balance.
C)net income.
D)sales.

Question

Quizplus · Accepted Answer

Under the indirect method, net income is adjusted for non-cash expenses and changes in current assets and liabilities to determine the net cash provided by operating activities. Therefore, the starting point to determine net cash provided by operating activities is net income.

Under the Indirect Method of Preparing the Statement of Cash