If Accounts Receivable Have Increased During the Period

question 31

Multiple Choice

If accounts receivable have increased during the period,

• A)revenues on an accrual basis are less than revenues on a cash basis.
• B)revenues on an accrual basis are greater than revenues on a cash basis.
• C)revenues on an accrual basis are the same as revenues on a cash basis.
• D)expenses on an accrual basis are greater than expenses on a cash basis.

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Definitions:

Financial Assets

Instruments that signify a financial claim or equity interest in an entity, including stocks, bonds, bank deposits, and mutual funds.

Nominal Interest Rate

The rate of interest before adjustments for inflation, indicating the face value of interest payments.

Real GDP

A country's economic production measure that accounts for fluctuations in prices due to inflation or deflation, indicating the true volume of goods and services created.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or selection among multiple options.