How much is the cash receipts from sales during the financial year?

Question:

What is the total amount of cash receipts from sales during the financial year for Tassie Limited?

Answer:

The cash receipts from sales during the financial year for Tassie Limited would amount to $37,600.

The calculation of cash receipts from sales involves considering the total sales, opening balance of accounts receivable, closing balance of accounts receivable, and any bad debts written off. In this scenario, the calculation is as follows:

  • Total Sales: $42,000
  • Opening Balance of Accounts Receivable: $9,000
  • Closing Balance of Accounts Receivable: $12,700
  • Bad Debts Written Off: $700

To determine the cash receipts from sales, we would add the total sales and the opening balance of accounts receivable, then subtract the closing balance of accounts receivable and the bad debts written off.

Calculation: ($42,000 + $9,000) - ($12,700 + $700) = $37,600

Therefore, the cash receipts from sales during the financial year for Tassie Limited is $37,600.

← Requirements contracts what happens when prices skyrocket Average days to sell inventory key concept in business and accounting →

More Posts: