Which of the Following Statements Is Correct

question 123

Multiple Choice

Which of the following statements is correct?

• A)A decrease in the accounts receivable balance means that credit sales exceeded cash collections from customers.
• B)The accounts receivable balance increases when cash collected from customers exceeds credit sales.
• C)A decrease in accounts receivable is deducted from net income when determining cash flow from operating activities.
• D)An increase in accounts receivable is deducted from net income when determining cash flow from operating activities.

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Definitions:

Consumer Price Index

An index measuring the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Competitive

A market situation wherein there are many sellers and buyers, leading to prices that reflect supply and demand.

Geographic Extent

The physical or virtual area over which a study, policy, or market operates, often influencing its scope and impact.

Real Price

The price of a good or service adjusted for inflation, reflecting its purchasing power relative to a specific base year.