If the December 31, 2019, balance of accounts receivable is lower than the January 1, 2019, balance, then the amount of cash collections will be more than the sales on account for the year.

Question

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If the balance of accounts receivable decreased from January 1, 2019, to December 31, 2019, it means that more cash was collected during the year than the sales made on account. This could be due to customers paying their balances promptly or the company writing off bad debts during the year.

If the December 31, 2019, Balance of Accounts Receivable Is