Under the indirect method of preparing the operating section of the statement of cash flows,net cash provided by operating activities is $197,000.If the direct method of preparing the operating section of the statement of cash flows was used:
A)net cash provided by operating activities would be the same,$197,000.
B)net cash provided by operating activities would be more than $197,000.
C)net cash provided by operating activities would be less than $197,000.
D)net cash provided by financing and investing activities would equal $197,000.

Question

Quizplus · Accepted Answer

The total net cash provided by operating activities remains the same whether the direct or indirect method is used. The difference between the two methods lies in the presentation of cash flows, not in the total amount reported.

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