Cat Nap Corp. uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance sheet:
Cat Nap Corp.
Comparative Balance Sheet
December 31, 2017 and 2016
2017 2016 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) positive cash flow under the financing activities section
B) negative cash flow under the investing activities section
C) subtraction from net income under the operating activities section
D) addition to net income under the operating activities section
