The accounts payable of a company changed from $136,100 to $104,300 over the course of a year. This change represents a:
A) use of $31,800 of cash as investment activity.
B) source of $31,800 of cash as an operating activity.
C) source of $31,800 of cash as a financing activity.
D) source of $31,800 of cash as an investment activity.
E) use of $31,800 of cash as an operating activity.

Question

Quizplus · Accepted Answer

The decrease in accounts payable indicates that the company paid off $31,800 of its liabilities, which is a use of cash in operating activities.

The Accounts Payable of a Company Changed from $136,100 to $104,300