Question

Cyber Company's 2016 income statement reported total sales revenue of 360,000. The 2015-2016 comparative balance sheets showed that accounts receivable increased by10,000. How much were cash receipts from customers during 2016?

Answer 1

To calculate cash receipts from customers during 2016, subtract the increase in accounts receivable from total sales revenue. In this case, the cash receipts would be $350,000.

Step-by-step explanation:

To calculate the cash receipts from customers during 2016, we need to determine the change in accounts receivable. We are given that accounts receivable increased by $10,000 from 2015 to 2016. Accounts receivable represents the amount of money owed to the company by its customers, so an increase in accounts receivable means that customers owe the company more money.

Cash receipts from customers represent the cash collected from customers for sales made during the year. To calculate it, we need to subtract the increase in accounts receivable from the total sales revenue. In this case, the total sales revenue is $360,000 and the increase in accounts receivable is $10,000. Therefore, the cash receipts from customers during 2016 would be $360,000 - $10,000 = $350,000.