To determine how much Harlan sold to customers, he must
A) add the increase in accounts receivable to total sales.
B) subtract the increase in accounts receivable from total sales.
C) add the increase in accounts payable to total cash.
D) subtract the increase in liabilities from owners' equity.

Question

Quizplus · Accepted Answer

To determine how much Harlan sold to customers, he must subtract the increase in accounts receivable from total sales. This is because the increase in accounts receivable represents sales that were made on credit and not yet collected in cash. Subtracting this amount from total sales gives the amount actually sold to customers in terms of cash or credit sales that have been paid.

To Determine How Much Harlan Sold to Customers, He Must