Leo Company reported sales of $200,000 in 2014during Year 2.Leo's balance sheets for 2014 Year 2 and 2013 Year 1 showed the following: $\begin{array}{|l|l|l|}
\hline &2014&2013\
\hline \text { Accounts receivable } & \$ 90,000 & \$ 80,000 \
\hline \text { Accounts payable } & 64,000 & 60,000 \
\hline
\end{array}$ Based on this information,how much cash did Leo collect from sales during 2014Year 2?
A) $204,000
B) $210,000
C) $290,000
D) $190,000

Question

Leo Company reported sales of $200,000 in 2014during Year 2.Leo's balance sheets for 2014 Year 2 and 2013 Year 1 showed the following: $\begin{array}{|l|l|l|}
\hline &2014&2013\
\hline \text { Accounts receivable } & \$  90,000 & \$  80,000 \
\hline \text { Accounts payable } &  64,000 &  60,000 \
\hline
\end{array}$ Based on this information,how much cash did Leo collect from sales during 2014Year 2?
A) $204,000
B) $210,000
C) $290,000
D) $190,000

Quizplus · Accepted Answer

The cash collected from sales is calculated as: Sales - Increase in Accounts Receivable = $200,000 - ($90,000 - $80,000) = $200,000 - $10,000 = $190,000.

Leo Company Reported Sales of $200,000 in 2014during Year 2