Use the Indirect Method to Calculate the Net Cash Provided

question 33

Multiple Choice

Use the indirect method to calculate the net cash provided or used) by operating activities based on the following information:

• A) $58,000.
• B) $45,700.
• C) $43,200.
• D) $35,000.
• E) $50,000.

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Definitions:

Accommodation Surety

A third party who guarantees the debt or obligation of another without benefit to themselves, often to help the borrower obtain a loan.

Guarantor

An individual or entity that agrees to be responsible for another's debt or performance under a contract if the primary party does not meet their obligations.

Guaranty Contract

A legal agreement where a guarantor agrees to fulfill the financial obligations of a debtor to a lender, in case the debtor fails to do so.

Suretyship Contract

An agreement whereby a party (surety) guarantees the performance of an obligation by another party (principal) to a third party (obligee).