Cash management Assessment 1

sabina

Hi,
Can anyone explain task 1.1?
I can't get my head around the trade receivables balance?

SabrinaA

Hi Sabina

The trade receivables balance is calculated by deducting the opening balance from the closing balance

£118,888 - £99,400 = £19,488

As the balance has reduced this means cash has come in therefore this will be a positive figure in the calculation of the closing cash position.

Hope that makes sense