Artemis Limited draws up its statement of cash flows using the direct method. The company presents you with the following figures:
$\begin{array}{lr}
&£ \
\text { Sales for the year to } 31 \text { May } 2019 & 550,000 \
\text { Trade receivables at } 31 \text { May } 2019 & 75,000 \
\text { Allowance for receivables at } 31 \text { May 2019 } & 9,000 \
\text { Trade receivables at } 31 \text { May } 2018 & 68,000 \
\text { Allowance for receivables at } 31 \text { May 2018 } & 6,000
\end{array}$ What was the cash received from sales for the year to 31 May 2019?
A) £543,000
B) £546,000
C) £554,000
D) £557,000

Question

Quizplus · Accepted Answer

Sales for the year to 31 May 2019 = £550,000Increase in trade receivables = £75,000 - £68,000 = £7,000Increase in allowance for receivables = £9,000 - £6,000 = £3,000Cash received from sales = Sales for the year - Increase in trade receivables - Increase in allowance for receivables= £550,000 - £7,000 - £3,000= £540,000

Artemis Limited Draws Up Its Statement of Cash Flows Using