Which one of the following is a source of cash?
A) A sale of merchandise to a customer on credit.
B) The purchase of new equipment for cash.
C) The payment of a long-term debt.
D) The purchase of goods from a supplier on credit.
E) A stock repurchase.

Question

Quizplus · Accepted Answer

Purchasing goods from a supplier on credit increases accounts payable, which is a liability, and does not immediately use cash, thus it is considered a source of cash.

Which One of the Following Is a Source of Cash