Receipts

Examples of Receipts in the following topics:

• Receipts

  • Receipts generally refer to the collection of accounts receivable, which are the payments of paying customers over time.
  • Receipts also refer to the returns off of short-term investments as well as the sale of various assets.
  • There are other potential incoming cash flows that also fall under receipts, which are worth noting on a case by case basis.
  • On the inverse side of receipts, disbursements are outgoing cash flows during a short-term business operation.
  • By comparing receipts with disbursements, the overall available cash flow can be derived.

• Components of the Cash Budget

  • The cash budget includes the beginning balance, detail on payments and receipts, and an ending balance.
  • A cash budget is a prediction of future cash receipts and expenditures for a particular time period, usually in the near future.
  • Cash receipts from customers - Collecting the accounts receivable.

• Present Value, Multiple Flows

  • The new product will have start-up expenditures, operational expenditures, and then it will have associated incoming cash receipts (sales) and disbursements (Cash paid for materials, supplies, direct labor, maintenance, repairs, and direct overhead) over 12 years.
  • This project will have an immediate (t=0) cash outflow of 100,000 (which might include all cash paid for the machinery, transportation-in and set-up expenditures, and initial employee training disbursements. ) The annual net cash flow (receipts less disbursements) from this new line for years 1-12 is forecast as follows: -54672, -39161, 3054, 7128, 25927, 28838, 46088, 77076, 46726, 76852, 132332, 166047, reflecting two years of running deficits as experience and sales are built up, with net cash receipts forecast positive after that.

• Reporting Financing Activities

  • Or as inflows, the receipt of payments for such financing vehicles by outside investors.

• Limitations of the Statement of Cash Flows

  • The cash flow statement includes only inflows and outflows of cash and cash equivalents; it excludes transactions that do not directly affect cash receipts and payments.

• Accounting Flows and Cash Flows

  • Identify the transaction through an original source document (such as an invoice, receipt, cancelled check, time card, deposit slip, purchase order) which provides the date, amount, description (account or business purpose), name and address of the other party.
  • Journals are kept in chronological order and may include a sales journal, a purchases journal, a cash receipts journal, a cash payments journal and the general journal.

• Depreciation

  • In determining the net income from an activity, the receipts from the activity must be reduced by appropriate costs.

• Managing Collections

  • The cash receipts cycle requires a diligent collection process.

• Recording Purchases

  • On the other hand, the purchaser adds the inventory on receipt (and the seller removes the item from inventory when it arrives with the purchaser) if the policy was FOB destination.

• Terms of Trade

  • Transit time is included when counting the days, i.e. a purchase in transit for 7 days before receipt has just 23 additional days until payment is due to the seller.