Vanishing Games Corporation (VGC) operates a massively multiplayer online game, charging players a monthly subscription of $14. At the start of January 2018, VGC's Income statement accounts had zero balances and Its balance sheet account balances were as follows: Cash $1,730, e00 188,e00 15, 200 921, e00 ses, e00 Accounts Receivable Supplies Equipment Buildings Land 1,790,e00 153,e00 163,800 Accounts Payable Deferred Revenue Notes Payable (due 2025) 124, e00 2,900, e00 1,812, 200 Conmon Stock Retained Earnings
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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.
Retained earnings (RE) is the amount of net income left over for the business after it has paid out dividends to its shareholders ,Often this profit is paid out to shareholders, but it can also be reinvested back into the company for growth purposes. The money not paid to shareholders counts as retained earnings.
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