April Wood Products' accounts receivable increased during the year by $4 million. a. What is the...
Question:
April Wood Products' accounts receivable increased during the year by $4 million.
a. What is the amount of cash April Wood Products received from customers during the reporting period if its sales were $44 million?
b. Prepare a summary entry that represents the net effect of the selling and collection activities during the reporting period.
Account Receivable:
Account receivable is a current asset account that records the amount that the company will be receiving from the customers. Account receivable is listed on the balance sheet of the company.
Answer and Explanation: 1
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Cash sales = Sales - Credit sales
Cash sales = 44,000,000 - 4,000,000
Cash sales = $40,000,000
Cash received from the customer is $40 million
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