If a company receives cash for providing services to customers,that transaction is
A) an asset source transaction.
B) an asset use transaction.
C) an asset exchange transaction.
D) either A or C

Question

Quizplus · Accepted Answer

A cash receipt from customers is a source of asset for the company, as it increases the cash balance in the company's account. Hence, it is an asset source transaction. Option B (asset use transaction) is incorrect because the company is not using any asset here, and option C (asset exchange transaction) is incorrect because there is no exchange of assets happening. Option D is partially correct, but as the cash receipt is primarily a source of asset, A is the best choice.

If a Company Receives Cash for Providing Services to Customers,that