If the December 31, 2016, balance of accounts payable is higher than the January 1, 2016, balance, then the amount of cash payments will exceed the purchases on account for the year.

Question

Quizplus · Accepted Answer

This statement is not necessarily true. It is possible that additional purchases were made on account during the year, resulting in the higher balance of accounts payable at the end of the year. Additionally, cash payments may not have been made for all purchases on account during the year.

If the December 31, 2016, Balance of Accounts Payable Is