Miller Company reported the following information in its 2020 financial statements ($ in millions): 2020 2019 Balance Sheet: Accounts receivable, net $ 2,448.4 $ 1,825.6 Income statement: Sales revenue $ 18,779.1 A note disclosed that the allowance for uncollectible accounts had a balance of $34.9 million and $33.7 million at the end of 2020 and 2019, respectively. Bad debt expense for 2020 was $24.0 million. Required: Determine the amount of cash collected from customers during 2020.
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Miller Company reported the following information in its 2020 financial statements ($ in millions):
| 2020 | 2019 | |
|---|---|---|
| Balance Sheet: | ||
| Accounts receivable, net | $ 2,448.4 | $ 1,825.6 |
| Income statement: | ||
| Sales revenue | $ 18,779.1 |
A note disclosed that the allowance for uncollectible accounts had a balance of $34.9 million and $33.7 million at the end of 2020 and 2019, respectively.
Required:
Determine the amount of cash collected from customers during 2020.
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