During 2011, the Accounts Receivable Balance of Big Buck Corporation

question 8

Multiple Choice

During 2011, the accounts receivable balance of Big Buck Corporation increased. From Big Buck's statement of cash flows, the financial reader would conclude which of the following?

• A) This increase indicates that Big Buck sold more than it collected in cash during the period.
• B) This increase is added to net income in the operating activities section of a statement of cash flows prepared under the indirect method.
• C) This increase is added to sales recognized on the income statement to determine the cash collections from customers during the period.
• D) This increase indicates that Big Buck purchased more than it sold in cash during the period.