[learnerfa]

Thanks a lot Mr. John. I appreciate all your contributions.

[learnerfa]

Mr. John one more time please check if understood it or not.

In my mind transaction should be like this after correction

Dr Receivable X
Dr Payable X
Cr Suspense 2X

And also I want to get high point from the exam. What would be your suggestions to me as a teacher. Which points I need to consider …
Any tips?

[learnerfa]

I think that I have problem with books ). I didn’t get your answer sir.

[learnerfa]

Thanks Mr. John. I finally understood the answer)

[learnerfa]

if we have receivable of say 100,000 dollars today and we extend it for 2 months for payment but it should be paid today i mean that our cash should be increased by this amount. So it means our cash balance affected by this amount.

[learnerfa]

Ok. However there is relation between receivables and cash and both of them are Current Assets. While Receivables Increase Cash receipts will decrease or vice versa so no change in total CA which in turn no change in Current Ratio. So confusing .

[Author]

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