Question 3 (7marks)

You are provided with the following information:

Sales for the year	$400 000
Discounts provided during the year to customers for early payment	$10 000
Doubtful debts expense for the year	$5 000
Opening balance of accounts receivable	$90 000
Closing balance of accounts receivable	$80 000
Opening balance of the provision for doubtful debts	$9 000
Closing balance of the provision for doubtful debts	$8 000
Cost of goods sold for the year	$60 000
Purchases for the year (on credit terms)	$80 000
Discounts received for early payment to suppliers	$2 000
Stock write-offs owing to water damage caused by melting ice in the Antarctic	$5 000
Opening balance of trade creditors	$40 000
Closing balance of trade creditors	$35 000
Opening balance of inventory	$10 000
Closing balance of inventory	$25 000

Required:

1. Calculate the cash receipts from customers during the year. (3.5 marks)
2. Calculate the cash payments to suppliers during the year. (3.5 marks)