A company has total sales revenue of $600 000 for a period.The balance of accounts receivable was $200 000 at the start of the year and $220 000 at the end of the year.Cash sales amounted to $50 000.Receipts from customers is:

Question

Quizplus · Accepted Answer

To calculate the receipts from customers, we need to subtract cash sales from the total sales revenue, then add the change in accounts receivable.

Total credit sales = Total sales revenue - Cash sales 
Total credit sales = $600,000 - $50,000 
Total credit sales = $550,000

Receipts from customers = Total credit sales + (Ending AR - Beginning AR) 
Receipts from customers = $550,000 + ($220,000 - $200,000) 
Receipts from customers = $550,000 + $20,000 
Receipts from customers = $570,000

However, the question asks for the receipts from customers, not including cash sales. Therefore, we need to subtract the cash sales from the calculated amount.

Receipts from customers (excluding cash sales) = $570,000 - $50,000 
Receipts from customers (excluding cash sales) = $520,000

But the question provides answer choices that are different from this calculated amount, so we need to check the options based on the calculations.

Option D is closest to our calculated amount of $520,000. Therefore, the best choice is D.

A Company Has Total Sales Revenue of $600 000 for a Period.The