Allison Co.uses the direct method to determine its cash flow from operations.During the year,it had sales revenue of $300,000.Its beginning Accounts Receivable balance was $30,000,and its ending Accounts Receivable balance was $40,000.Its cash collected from customers for the year was:
A) $300,000.
B) $290,000.
C) $310,000.
D) $370,000.

Question

Quizplus · Accepted Answer

The cash collected from customers during the year can be calculated as:
Beginning Accounts Receivable + Sales Revenue - Ending Accounts Receivable = Cash collected from customers
$30,000 + $300,000 - $40,000 = $290,000 
Therefore, the correct answer is B, $290,000.