grande company had credit sales of 38,000 in the current period. accounts receivable had a beginning balance of 8,500 and an ending balance of 10,400. Compute its coach collections from its credit sales for the current period.
To calculate the cash collections from credit sales, we need to determine how much of the accounts receivable balance increase is due to sales made in the current period.
Beginning Accounts Receivable: $8,500
Ending Accounts Receivable: $10,400
Increase in Accounts Receivable: $10,400 - $8,500 = $1,900
This $1,900 increase in accounts receivable represents credit sales made in the current period. Therefore, the cash collections from credit sales for the current period would be:
Credit Sales - Increase in Accounts Receivable
$38,000 - $1,900
$36,100
So, Grande Company's cash collections from credit sales for the current period would be $36,100.