Plimpton Sales Presents Income Statements for the First Three Months

Plimpton Sales presents income statements for the first three months of this year.Revenues are $1,000,000 in January,$1,200,000 in February,and $1,400,000 in March,while expenses total $800,000 in January,$900,000 February,and $1,000,000 in March.Despite the positive net income,the controller believes Plimpton Sales needs to arrange short-term financing of $300,000 to make payroll the next month.Which of the following statements is MOST correct?

A) The controller must have made a mistake since the company's net income for the three months is $900,000.
B) The company's accounts receivable balance has decreased over the past three months.
C) The company's accounts payable balance has increased over the past three months.
D) The company's accounts receivable balance has increased and the accounts payable balance has decreased over the past three months.

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