Cash collected on accounts receivable would produce what effect on the balance sheet?
A) Increase liabilities and decrease equity
B) Decrease liabilities and increase equity
C) Increase assets and decrease assets
D) Decrease assets and decrease liabilities

Question

Quizplus · Accepted Answer

Cash collected on accounts receivable produces an increase in cash and a decrease in accounts receivable, both asset accounts. There is no impact on profit and on equity.

Cash Collected on Accounts Receivable Would Produce What Effect on the Balance