Question

During 2022, Metlock, Inc. had $117000 in cash sales and $918000 in credit sales. The accounts receivable balances were $162000 and $190800 at December 31, 2021 and 2022, respectively. Using the direct method of reporting cash flows from operating activities, what was the total cash collected from all customers during 2022

Answer 1

The cash collections in the year 2022 comes out to be $1,006,200 by using the direct method of cash flow statement.

What is a cash flow statement?

A cash flow statement is an accounting record which tells the final cash position of an entity after finalizing the balance sheet and income statement.

Given values:

Total sales: $1,035,000 (Cash sales + Credit sales)

Increase in accounts receivables: $28,800 (Closing amount - Opening amount)

Computation of cash collected from customers by direct method:

$\rm\ Cash \rm\ Collections \rm\ from \rm\ Customers=\rm\ Total \rm\ Sales-\rm\ Increase \rm\ in \rm\ Accounts \rm\ Receivable\\\rm\ Cash \rm\ Collections \rm\ from \rm\ Customers=\ 1,035,000-\ 28,800\\\rm\ Cash \rm\ Collections \rm\ from \rm\ Customers=\ 1,006,200$

Therefore, when the sales are in total of $1,035,000 and there is a increase in receivables by $28,800, then the amount of cash collections comes out to be $1,006,200.

Learn more about the cash flow statement in the related link:

https://brainly.com/question/27454259

#SPJ1