If revenue from operations are Rs 48000; opening trade receivables are Rs 8000 and closing trade receivables are Rs 6000; calculate cash receipts from customers.
Answers
Answer:
ok
Explanation:
Calculate opening and closing trade receivables from the following information: <br> Cash revenue from operations=
of credit revenue from operations <br> Cost of revenue form operations=Rs 360000 <br> Gross profit =25% of revenue from operations <br> Trade receivables at the end were 3 times that of in the beginning <br> Trade receivables Turnover Ratio 3 times.
Solution :
Total revenue from opertions (i.e slaes) <br> =Cost of revenue from operation +gross profit (Note 1) <br>
<br> Credit revenue from operations=Rs 360000(note 2) <br> Trade receivable trunover ratio =
<br>
<br> Average trade reveivable =
<br> Calculation of opening and closing trade receivables: <br> Let opening trade receivables =x <br> therefore closing trade receivable =3x <br> Average trade receivables =
<br>
<br>
<br>
<br> Closing Trade receivables =3x=
Answer:
To calculate cash receipts from customers, we need to consider the changes in trade receivables during the period.
Explanation:
Trade receivables refer to the amount of money a company owes its customers for goods or services sold on credit.
The formula to calculate cash receipts from customers is as follows:
Cash Receipts from Customers = Revenue from Operations - Decrease in Trade Receivables + Increase in Trade Receivables
In this case, we are given that the revenue from operations is Rs 48000, the opening trade receivables are Rs 8000, and the closing trade receivables are Rs 6000. To calculate the decrease in trade receivables, we need to subtract the closing trade receivables from the opening trade receivables.
Decrease in Trade Receivables = Opening Trade Receivables - Closing Trade Receivables
= Rs 8000 - Rs 6000
= Rs 2000
Since the closing trade receivables are lower than the opening, there has been a decrease in trade receivables. Therefore, we need to subtract this amount from the operations revenue to calculate the customers' cash receipts.
Cash Receipts from Customers = Revenue from Operations - Decrease in Trade Receivables
= Rs 48000 - Rs 2000
= Rs 46000
Therefore, the cash receipts from customers for this period are Rs 46000.
In conclusion, calculating cash receipts from customers is important as it helps a company track its cash flow and manage its working capital. It is important to monitor the changes in trade receivables as they directly affect customer cash receipts. By understanding the formula and considering the changes in trade receivables, a company can better manage its cash flow and make informed business decisions.
To learn more about cash, click on the given link.
https://brainly.in/question/1508758
To learn more about trade, click on the given link.
https://brainly.in/question/4228612
#SPJ2