Which of the Following Is the Correct Formula for Calculating

question 18

Multiple Choice

Which of the following is the correct formula for calculating cash collections from customers?

• A) sales for the period plus accounts receivable at the beginning of the period
• B) sales for the period plus accounts receivable at the beginning of the period minus accounts receivable at the end of the period
• C) sales for the period plus accounts receivable at the end of the period
• D) sales for the period plus accounts receivable at the end of the period minus accounts receivable at the beginning of the period

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Definitions:

Par Value

The face value of a bond or stock, indicating the amount that must be repaid at maturity (for bonds) or the nominal value of a share (for stocks).

Consideration Transferred

Consideration transferred is the total value of assets, liabilities, or equity shares that an acquirer gives up in order to acquire control of a target company in a business combination.

Business Combination

A transaction or event where a company acquires control over one or more businesses, often through a merger or acquisition.

Common Stock

A type of equity ownership in a corporation, representing a claim on a portion of the profits and assets, with voting rights.