Question

Deluxe Hotels reported revenues of​ $570,000 for the year ended December​ 31, 2019. Accounts receivable at December​ 31, 2018 and 2019 were​ $67,000 and​ $47,000. If Deluxe uses the direct method of reporting operating cash​ flows, the company would report cash collected from customers of​ ________.

Answer 1

Answer:

$590,000

Explanation:

To calculate Deluxe's operating cash flow for 2019, we can use the following formula:

2019 cash flow = sales - (ending accounts receivable - beginning accounts receivable)

2019 cash flow = $570,000 - ($47,000 - $67,000) = $570,000 - (-$20,000)

2019 cash flow = $590,000