Question: Georgia Corp. uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance sheet: Georgia Corp.
Georgia Corp. uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance sheet:
| Georgia Corp. |
| Comparative Balance Sheet |
| December 31, 2019 and 2018 |
| 2019 | 2018 | Increase/(Decrease) | |
| Cash | $45,000 | $27,000 | $18,000 |
| Accounts Receivable | 48,000 | 45,000 | 3,000 |
| Merchandise Inventory | 180,000 | 132,000 | 48,000 |
| Total Assets | $273,000 | $204,000 | $69,000 |
How will the change in Accounts Receivable be shown on the statement of cash flows?
| a. subtraction from net income under the operating activities section | ||
| b. negative cash flow under the investing activities section | ||
| c. positive cash flow under the financing activities section | ||
| d. addition to net income under the operating activities section |
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