Spencer Corp. reported accounts receivable of $28,000 on its December 31, 2016, balance sheet. On December 31,

Question:

Spencer Corp. reported accounts receivable of $28,000 on its December 31, 2016, balance sheet. On December 31, 2017, accounts receivable had decreased to $22,000. Sales for the year amounted to $55,000. What is the amount of cash collections that Spencer will report in the Operating Activities section of its 2017 statement of cash flows assuming that the direct method is used?

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...