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Alpha’s first year of trading was 2014. Alpha is a sole trader who doesn’t keep proper accounting.
From reviewing Alpha’s bank statement and incomplete records related to cash the following has been seen
Bank and Cash summary, Alpha, 2014
Cash received from credit customers and paid to the bank 381600
Exp paid out of cash received from credit customer before banking 6800
cash sales 112900Other info, alfha, 2014
irrecoverable debts written off 7200
closing balance of receivables 0
What is alpha’s sales figure?Can you please elaborate on the solution? There is a direct answer given and im not sure how it was derived
The total cash received from credit customers was 381,600 + 6,800 = 388,400.
There were irrecoverable debts written off and therefore the total sales to credit customers must have been 388,400 + 7,200 = 395,600.In addition there were cash sales of 112,900, so the total sales must have been 395,600 + 112,900 = $508,500.
I did not include irrecoverable debt but I guess that is still included in the sales. Thanks John
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