Final answer:
An invoice does indeed increase Accounts Receivable (A/R) and also increases an appropriate income account, reflecting the accrual basis accounting principle where transactions are recorded when they are earned.
Step-by-step explanation:
The statement 'An invoice increases A/R (Accounts Receivable) and increases an appropriate income account' is true. When a company issues an invoice to a client, the amount of the invoice is recorded as an increase in the company's Accounts Receivable, representing money that the client owes to the company. Concurrently, the revenue (or an appropriate income) account is also increased, recognizing the income earned from the sale of goods or services, even though the cash has not yet been received. This is known as accrual basis accounting, where revenue is recognized when earned, and expenses are recognized when incurred, regardless of the cash flow.