Question

Sales for the year were $500,000. Accounts receivable were $100,000 and $80,000 at the beginning and end of the year, respectively. Cash received from customers to be reported on the cash flow statement using the direct method is a.$520,000. b.$480,000. c.$500,000. d.$600,000.

Answer 1

a.$520,000

Step-by-step explanation:

Amount($)

Sales for the year 500,000

Opening accounts receivable 100,000

Closing accounts receivable (80,000)

Cash received from customers 520,000

Cash received from customers to be reported on the cash flow statement using the direct method is $520,000.

Cash flow statements are usually stated using the direct method or indirect method.