Which item represents a use of cash when there is an increase from one accounting period to the next?

When considering cash flow and the implications of changes in accounts on the balance sheet, an increase in accounts receivable from one accounting period to the next represents a use of cash. This is because accounts receivable is recorded when a company makes sales on credit. An increase indicates that more sales have been made without immediate cash inflow; the company is waiting to collect that cash from customers. Essentially, cash is tied up in these receivables until they are collected.

This scenario exemplifies how cash flow can be impacted by credit sales. While the revenue is recognized, the actual cash has not yet been received, leading to a temporary cash outflow situation. Thus, an increase in accounts receivable means more funds are expected to come in the future, but, at present, this represents a shift in cash utilization rather than cash generation.