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Converting Sales Revenue to Cash Smith & Sons is converting its sales revenues to corresponding cash...

Converting Sales Revenue to Cash
Smith & Sons is converting its sales revenues to corresponding cash amounts using the direct method. Sales revenue on the income statement are $2,050,000.

Beginning and ending accounts receivable on the balance sheet are $116,000 and $68,000, respectively.

Calculate the amount of cash received from customers.

$Answer

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Expert Solution

Cash received from customers using the Direct Method
Sales $                                                     20,50,000.00
Add: Decrease in Accounts receivable $                                                           48,000.00
Cash received from customers $                                                     20,98,000.00
Decrease in Accounts Receivable
Beginning Accounts Receivable=(A) $                                                        1,16,000.00
Ending Accounts Receivable=(B) $                                                           68,000.00
Decrease in Accounts Receivable=(A)-(B) $                                                           48,000.00

ekkarill92 answered 3 years ago
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