Total Cash Receipts in July
Understanding Total Cash Receipts Calculation
Based on the data provided, the cash account balance on July 1 was $37,450. Throughout July, cash payments totaled $115,860, resulting in a balance of $29,600 on July 31. In order to determine the total cash receipts during July, we need to reconcile the starting balance, payments, and ending balance.
Starting with the initial balance of $37,450, we deduct the total cash payments of $115,860. This calculation results in a negative balance of -78,410 ($37,450 - $115,860 = -78,410). To reach the ending balance of $29,600, there must have been additional cash receipts to offset the negative balance.
Therefore, to calculate the total cash receipts, we add the ending balance of $29,600 to the negative balance of -78,410: $29,600 - (-78,410) = $108,010. This signifies that the total cash receipts during July amounted to $108,010.
In conclusion, by analyzing the cash account balance and transactions, we can determine that the total cash receipts in July were $108,010.