The Retained earnings is increased when cash is received from customers in payment of previously recorded accounts receivable.

Name: The Retained earnings is increased when cash is received from customers in payment of previously recorded accounts receivable.
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Question

Quizplus · Accepted Answer

Receiving cash from customers for previously recorded accounts receivable does not affect retained earnings; it only changes the composition of assets by increasing cash and decreasing accounts receivable.

The Retained Earnings Is Increased When Cash Is Received from Customers