Financial management (need in 2:30 hours today 01/09/2018)
Accounts Receivable: This is money owed to the business for goods or services rendered; an increase in this account would be a source of cash while a decrease would be considered a use. In 2015 the accounts receivable increased by $5,000 which was a source of cash.
Inventory: Any increases or decreases in inventory reflect either sources or uses depending on whether items have been purchased or sold respectively. In 2015 there was an increase in inventory of $6,000 which was a use of cash.
Total Assets = Total Liabilities + Owner’s Equity
The total assets for 2015 were $81,000 while total liabilities and owner’s equity amounted to $76,000; thus it appears that my numbers do add up and make sense since the difference between these two values is equal to the net change in each individual account ($20k+$5k-$6k=$19k).