The amount of increases in accounts receivable is added to credit sales to calculate the amount of cash inflow from customers when using the direct method to prepare the statement of cash flows.

Name: The amount of increases in accounts receivable is added to credit sales to calculate the amount of cash inflow from customers when using the direct method to prepare the statement of cash flows.
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Question

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Increases in accounts receivable are deducted from credit sales to determine cash collections from customers.

The Amount of Increases in Accounts Receivable Is Added to Credit