Which one of the following is a source of cash? A. increase in accounts receivable B....

Which one of the following is a source of cash?

A. increase in accounts receivable

B. decrease in notes payable

C. decrease in common stock

D. increase in accounts payable

E. increase in inventory

Solutions

Expert Solution

Answer: Increase in accounts payable

Increase in accounts payable implies company is purchasing products or services on credit and hence is not paying cash. SO it is a source of cash.

All other options either require use of cash like retirement of notes payable, common stock redemption, increase in inventory or increase in accounts receivables.

jeff jeffy answered 1 year ago

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