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If the Accounts Receivable Balance on a Firm's Balance Sheet

Question 8

Multiple Choice

If the accounts receivable balance on a firm's balance sheet decreases without any change in credit sales,the operating cycle will


A) increase due to the increased receivables turnover rate.
B) decrease because the number of days' sales in receivables will decrease.
C) remain constant because credit sales are constant.
D) remain constant because the accounts receivable and inventory periods will be constant.
E) remain constant because cash collections affect the cash cycle,not the operating cycle.

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