Question

At the beginning of January of the current year, Sorrel Co.’s ledger reflected a normal balance of $70,000 for accounts receivable. During January, the company collected $18,400 from customers on account and provided additional services to customers on account totaling $14,300. Additionally, during January one customer paid Mikey $6,800 for services to be provided in the future.

Required:
a. At the end of January, the balance in the accounts receivable account should be ____________.

Answer 1

Balance of Accounts Receivable in the end of January = Beginning balance + Revenue from earned services - Collections during the period

= 70000 + 14300 - 18400

= $65900

At the end of January, the balance in the accounts receivable account should be $65900