Erie Company began the accounting period with $27,000 in accounts receivable.The ending balance in accounts receivable was $10,000.If the credit sales during the period were $44,000,what is the amount of cash received from customers?
A) $27,000
B) $44,000
C) $81,000
D) $61,000

Question

Quizplus · Accepted Answer

The cash received from customers is equal to the total credit sales minus the decrease in accounts receivable.

Cash received from customers = Credit sales - (Beginning accounts receivable - Ending accounts receivable)

Cash received from customers = $44,000 - ($27,000 - $10,000)

Cash received from customers = $44,000 - $17,000

Cash received from customers = $27,000

Therefore, the correct answer is D) $61,000.

Erie Company Began the Accounting Period with $27,000 in Accounts