what are the effects of these exchanges on the business rsquo s financial condition 626213

A business requires advance payments on all sales. In other words, it collects cash from customers before products are delivered to them later. During the year, the business received $12,500,000 in advance payments from customers. By the end of the year, the business had delivered 85 percent of products to customers for advance payments received during the year. Also, the business delivered products to customers during the year that fully discharged the $1,500,000 balance in liability for advance payments at the start of the year. What are the effects of these exchanges on the business’s financial condition?