Question

At the beginning of 2014, Sabrina Company had the following normal ledger balances: Accounts Receivable: $24,000 Allowance for Uncollectible Accounts: $1,000 During the year there were $450,000 of credit sales, $460,000 of collections from credit customers, and $3,700 of write-offs of delinquent accounts. At the end of the year, the company adjusted for bad debts expense using the percent-of-sales method, and applied a rate, based on past history, of 1.2%. At the end of the year, what was the balance in the Accounts receivable

Answer 1

$10,300

Step-by-step explanation:

Accounts receivable, beginning = $24,000

Credit sales = $450,000

Cash collections from customers = $460,000

Accounts receivables written off = $3,700

Accounts receivables, ending = Accounts receivable, beginning + Credit sales - Cash collections from customers - Accounts receivables written off

Accounts receivables, ending = $24,000 + $450,000 - $460,000 - $3,700

Accounts receivables, ending = $10,300

So, at the end of the year, the balance in the Accounts receivable is $10,300.