"Which of the following statements is not true: Multiple Choice Accounts receivable arise from credit sales. Accounts receivable are classified as assets. Accounts receivable are increased by customer payments. Accounts receivable are increased by billings to customers. Accounts receivable are held by a seller."

Correct answer is: Accounts receivable are increased by customer payments.

Explanation:

Accounts Receivable – refers to sales that have occurred on credit, meaning that the company has not yet collected the cash proceeds from these sales. Found in the “current assets” section of the balance sheet.

Accounts receivable is the amount owed to a seller by a customer. As such, it is an asset, since it is convertible to cash on a future date. Accounts receivable is listed as a current asset in the balance sheet, since it is usually convertible into cash in less than one year.

These assets are increased by credit sales, and billings to costumers but not by costumer payments when a customer pays it increases in an account called sales rather than in the fees revenue account .

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