Collection of an accounts receivable will:
A)increase the cash account and decrease the accounts receivable account.
B)increase both the cash account and the accounts receivable account.
C)decrease both the cash account and the accounts receivable account.
D)decrease the cash account and increase the accounts receivable account.

Question

Quizplus · Accepted Answer

When an accounts receivable is collected, it means that the company is receiving payment for the amount owed to them. This payment is recorded as an increase in the cash account as the company now has more cash on hand, and a decrease in the accounts receivable account as the debt owed to the company has been paid off. Therefore, option A is the correct choice.

Collection of an Accounts Receivable Will