Sanchez Inc. sells to customers only on credit. For the year ended December 31, 2017, the following information is provided:
$\begin{array}{lrr}
\text {Sales revenue } &\$850,000\
\text {Accounts receivable, 1/01/17 } &230,000\
\text { Allowance for doubtful accounts, $ 12 / 31 / 17 $ (before adjustment for bad debts) } &600\
\text { Collections during 2017 } &470,000\
\text { Accounts written off as uncollectible during 2017 } &13,000\
\text {Sales returns } &7,000\
\end{array}$

What is the balance of the Accounts Receivable account at December 31, 2017?
A)$1,525,000
B)$590,000
C)$205,000
D)$135,000

Question

Sanchez Inc. sells to customers only on credit. For the year ended December 31, 2017, the following information is provided:
$\begin{array}{lrr}
  \text {Sales revenue  } &\$850,000\
 \text {Accounts receivable, 1/01/17  } &230,000\
 \text { Allowance for doubtful accounts, $ 12 / 31 / 17 $ (before adjustment for bad debts) } &600\
 \text { Collections during 2017 } &470,000\
 \text { Accounts written off as uncollectible during 2017 } &13,000\
 \text {Sales returns  } &7,000\
\end{array}$

What is the balance of the Accounts Receivable account at December 31, 2017?
A)$1,525,000
B)$590,000
C)$205,000
D)$135,000

Quizplus · Accepted Answer

To find the balance of the Accounts Receivable account at December 31, 2017, we start with the opening balance of accounts receivable, add the net sales (sales revenue minus sales returns), and then subtract the collections and accounts written off as uncollectible. Starting balance of accounts receivable on 1/01/17: $230,000Net sales (Sales revenue - Sales returns): $850,000 - $7,000 = $843,000Collections during 2017: $470,000Accounts written off as uncollectible during 2017: $13,000Calculation:Opening balance + Net sales - Collections - Accounts written off= $230,000 + $843,000 - $470,000 - $13,000= $590,000Therefore, the balance of the Accounts Receivable account at December 31, 2017, is $590,000.

Sanchez Inc What Is the Balance of the Accounts Receivable Account at Year