Dallas Corp.reported the following information for 2016 and 2017. $$\begin{array} { l r }
\text { Interest receivable, December } 31,2016 & \$ 1,100 \
\text { Interest receivable, December } 31,2017 & 1,400 \
\text { Interest income-2017 } & 3,200
\end{array}$$ How much cash was received for interest during 2017?
A) $2,900
B) $3,200
C) $3,500
D) $3,800

Question

Dallas Corp.reported the following information for 2016 and 2017. $$\begin{array} { l r } 
\text { Interest receivable, December } 31,2016 & \$ 1,100 \
\text { Interest receivable, December } 31,2017 & 1,400 \
\text { Interest income-2017 } & 3,200
\end{array}$$ How much cash was received for interest during 2017?
A) $2,900
B) $3,200
C) $3,500
D) $3,800

Quizplus · Accepted Answer

The cash received for interest is calculated by adjusting the interest income for the change in interest receivable. The interest receivable increased by $300 ($1,400 - $1,100), which means that $300 of the interest income was not received in cash. Therefore, the cash received is $3,200 - $300 = $2,900.

Dallas Corp How Much Cash Was Received for Interest During 2017? A)

Dallas Corp How Much Cash Was Received for Interest During 2017?
A)