How is the receipt of $75 from Angela for a balance due categorized?

The receipt of $75 from Angela for a balance due is categorized as cash receipts because it represents incoming cash flow to the organization from a previously outstanding obligation. Cash receipts denote any cash that is received by a business or entity, typically from customers settling their debts or from sales made. In this context, since Angela is paying a balance that she owes, the transaction is categorized as a cash receipt, reflecting an increase in the company’s cash assets.

Sales, on the other hand, would pertain to income generated from selling goods or services, not specifically the receipt of payment. Cash disbursements relate to money that is paid out, such as expenses or payments to suppliers, which does not apply in this case where cash is being received. Lastly, purchases refer to the act of acquiring goods or services, which does not relate to the action of receiving payment from a customer. Therefore, cash receipts is the most accurate category for this transaction.