Sales transactions are the main source of operating revenue for most business
enterprises, and thus, the accounts receivable produced by credit sales transactions are
material to the balance sheet for all businesses except where cash receipts are
predominant.

Question

Quizplus · Accepted Answer

Sales transactions typically generate the most revenue for businesses and accounts receivable resulting from credit sales are important components of the balance sheet for most businesses. However, businesses where cash transactions are dominant may not have significant accounts receivable balances.

Sales Transactions Are the Main Source of Operating Revenue for Most