If the accounts receivable balance decreases during the accounting period, this means that:
A) more cash was collected than the amount of credit sales that were made.
B) less cash was collected than the amount of credit sales that were made.
C) it does not affect the cash balance.
D) revenue is higher than cash collected.

Question

Quizplus · Accepted Answer

using opening balance + credit sales less cash collections, the closing balance must be lower if cash collections exceed credit sales

If the Accounts Receivable Balance Decreases During the Accounting Period