Question

Newark Company has provided the following information: Cash sales, $470,000 Credit sales, $1,370,000 Selling and administrative expenses, $350,000 Sales returns and allowances, $92,000 Gross profit, $1,380,000 Increase in accounts receivable, $57,000 Bad debt expense, $35,000 Sales discounts, $45,000 Net income, $1,030,000 How much cash was collected from customers?

Answer 1

$1,703,000

Step-by-step explanation:

Cash sales = $470,000

Credit sales = $1,370,000

Selling and administrative expenses = $350,000

Sales returns and allowances = $92,000

Gross profit = $1,380,000

Increase in accounts receivable = $57,000

Bad debt expense = $35,000

Sales discounts = $45,000

Net income = $1,030,000

Net sales:

= Cash sales + Credit sales - Sales returns and allowances - Sales discounts

= $470,000 + $1,370,000 - $92,000 - $45,000

= $1,703,000