Answer:
a. $404,000
b. $60,000
Explanation:
a. The computation of cash received is shown below:
= Sales for the current year + increased in accounts receivable during the year
= $375,000 + $29,000
= $404,000
The increase in accounts receivable show the predicted cash which will be received in near by future. So, it is added in the computation part.
Hence, the amount of cash received from customers is $404,000
b. Computation of cash payment for income tax is shown below:
= Income tax for the current year + decrease in income tax payable during the year
= $39,000 + $21,000
= $60,000
Both transactions should be added to know the accurate figure of income tax payment made in cash.
Hence, the cash payments for income tax is $60,000
