Dallas Corp.reported the following information for 2017 and 2018:$\begin{array}{lr}
\text { Interest receivable, December } 31,2017 & \$ 1,100 \
\text { Interest receivable, December } 31,2018 & 1,400 \
\text { Interest income-2018 } & 3,200
\end{array}$ How much cash was received for interest during 2018?

A)$2,900
B)$3,200
C)$3,500
D)$3,800

Question

Dallas Corp.reported the following information for 2017 and 2018:$\begin{array}{lr}
\text { Interest receivable, December } 31,2017 & \$ 1,100 \
\text { Interest receivable, December } 31,2018 & 1,400 \
\text { Interest income-2018 } & 3,200
\end{array}$ How much cash was received for interest during 2018?

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), so the cash received is $3,200 (interest income) - $300 (increase in receivable) = $2,900.

Dallas Corp How Much Cash Was Received for Interest During 2018?