![]() ![]() cash payment), A/R declines and the cash impact is positive.Īnother current asset would be inventory, where an increase in inventory represents a cash reduction (i.e. Once the customer fulfills their end of the agreement (i.e. ![]() If accounts receivable (A/R) were to increase, purchases made on credit have increased and the amount owed to the company sits on the balance sheet as A/R until the customer pays in cash.
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