Accounts receivable arising from sales to customers amounted to $¥ 800,000$ and $¥ 700,000$ at the beginning and end of the year, respectively. Income reported on the income statement for the year was $¥ 2,800,000$. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is

Question

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The decrease in accounts receivable by $¥ 100,000$ (from $¥ 800,000$ to $¥ 700,000$) indicates that more cash was collected than sales made on credit, so $¥ 100,000$ should be added to the income to calculate cash flows from operating activities, resulting in $¥ 2,900,000$.

Accounts Receivable Arising from Sales to Customers Amounted To ¥800,000¥ 800,000¥800,000

Accounts Receivable Arising from Sales to Customers Amounted To $¥ 800,000$