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Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
ISBN: 9781337788281

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BuyFindarrow_forward

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
ISBN: 9781337788281
Textbook Problem
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Given the following information, convert Lark Company’s sales revenue from its income statement into collections from customers for its statement of cash flows.

Chapter 21, Problem 2RE, Given the following information, convert Lark Companys sales revenue from its income statement into

To determine

Determine the cash collections from customers of L Company.

Explanation

Cash Collection from customers: cash collected from customers depends on the amount of sales revenue generated and change in accounts receivable during the period. Use the following formula to find the cash collection from customers.

Cash collection from customers={Sales revenue(+Decrease in accounts receivable               or                 Increase in accounts receivable+Increase in deferred revenuesorDecrease in deferred revenue)}

Find cash collections from customers of L Company:

Cash collection from customers={Sales r

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