In exercise-6 we used formula approach to calculate cash received from customer. We can also compute this figure by making an accounts receivable t-account. In this exercise, we shall use the data from exercise-6 and calculate cash received from customers during a period using t-accounts approach.
The followin information belongs to Alpha company:
|Year 2015||Year 2014|
|Allowance for doubtful accounts||$3,200||2,100|
The company sells goods on credit. For the year 2015, bad debts expense were $7,500 and accounts amounting to $6,400 were written-off.
Required: Find out the amount of cash collected from customer using t accounts approach.
*Balancing figure – the cash received from customers.