X Company is a merchandiser and prepares monthly financial statements. On Septem

Question

X Company is a merchandiser and prepares monthly financial statements. On September 6, its accountant made an entry that resulted in a $54,000 increase in the Cash account and a $54,000 decrease in the Accounts Receivable account. Which of the following transactions is consistent with this entry? X Company paid $54,000 to a supplier from whom the firm had previously bought merchandise on account. sold merchandise to customers on account for $54,000 O received $54,000 from a customer who had previously bought merchandise on account. received $54,000 from a customer who bought merchandise with cash. O received $54,000 from a new investor borrowed $54,000 from a bank and signed a note. Submit Answer Tries 0/2

Explanation / Answer

Increase in the CAsh by $ 54,000 it means we received the cash from Account Receivable.

Decrease in Account Receivable means we collect the Cash from account receivable.

So It Means we received the Cash of $ 54,000 from the our Account Receivable who previously bought materail from us on credit.

Answer = Option 3 = Received $ 54,000 from a customer who had previously bought material on account

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