3) Central Co. began the year with an accounts receivable balance of $55,000, an

Question

3) Central Co. began the year with an accounts receivable balance of $55,000, and ended the year with an accounts receivable balance of $64,000. During the year, Central Co. recorded $440,000 of sales on account How much cash did Central Co. collect from its customers during the year? 4) A&G; Inc. began the year with an accounts payable balance related to inventory purchases of $20,000. The balance in the account at the end of the year was $4,000. During the year, A&G; Inc. purchased $108,000 of inventory on account. How much cash did A&G; Inc. pay for inventory purchases during the year?

Explanation / Answer

Q3. Calculation of collection from customers during the year

Q4. Calculation of payment for inventory purchases during the year:

Particulars Amount Opening Balance of Accounts Receivable $55,000 Add: Sales during the year $440,000 Less: Closing Balance of Accounts Receivable $64,000 Collection from customers during the year $431,000

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