Question

Bayside will collect​ $24,000 from its customer when the job is finished but the revenue is earned evenly over the six months. On March​ 31, before adjusting entries are​ made, Bayside's Accounts Receivable account had a debit balance of​ $4,000. After the March 31 monthly adjusting entry has been​ made, what will be the balance in Accounts​ Receivable?

Answer 1

The balance in the Accounts Receivable amounts to $8,000

Step-by-step explanation:

The balance in the Accounts Receivable is computed as:

Accounts receivable balance = Collected amount × Month / Total months + Debit balance of Accounts Receivable

where

Collected amount is $24,000

Month is 1 as for the month of march

Total months will be 6 as it is for six months

Debit balance of accounts receivable is $4,000

Putting the values above:

Accounts receivable balance = $24,000 × 1/ 6 + $4,000

Accounts receivable balance = $4,000 + $4,000

Accounts receivable balance = $8,000