A business renders service to a client and sends out a sales invoice. The amount will be collected from the customer at a later time. Which of the following would be TRUE at the time when the invoice is sent out?

Question

Quizplus · Accepted Answer

When a sales invoice is sent out, it recognizes revenue, which increases profit. The accounts receivable (an asset) increases, but there is no immediate cash inflow, so total assets remain unchanged at this point.

A Business Renders Service to a Client and Sends Out