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

The starting point to determine the Net cash provided by operating activities under the indirect method is the net income. This is because the indirect method adjusts the net income by adding back non-cash expenses and deducting non-cash revenues to arrive at the cash flow from operating activities. Therefore, the net income is the best choice among the given options.

Under the Indirect Method of Preparing the Statement of Cash