Question

credit sales = $8,000. Beginning and ending accounts receivable = $1,800 and $1,400, respectively. What are...

credit sales = $8,000. Beginning and ending accounts receivable = $1,800 and $1,400, respectively. What are collections and the age of accounts receivable, assuming a 360-day year?

A. $7,600 and 36 days.

B. $7,600 and 72 days.

C. $8,000 and 10 days.

D. $8,400 and 36 days.

E. $8,400 and 72 days.

Homework Answers

Answer #1

Answer: Option E. $ 8,400 and 72 days

Calculation of collection as follows:

Collection = Total receivables - Ending account receivable

= $9,800 - $1,400

= $8,400

Total receivables = Begining account receivable + credit sales

= $1,800 + $8,000

= $9,800

Calculation of age of accounts receivable as follows:

Age of accounts receivable = (Average Accounts receivable / Credit sales ) * 360 days

= ($1,600 / $8,000) * 360

= 72 days

Average accounts receivable = ( Beginning accounts receivable + Ending accounts receivable ) / 2

= ( $1800 + $1,400 ) / 2

= $ 1,600

Thus, Collection and age of accounts receivable is $8,400 and 72 days ( answer option E)

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
McNealy Corporation had a beginning and ending accounts receivable balance of $50,000 and $106,000, respectively. During...
McNealy Corporation had a beginning and ending accounts receivable balance of $50,000 and $106,000, respectively. During the year, Mulder had credit sales of $68,000 and write-offs of $14,000. If McNealy estimates bad debt expense at 5% of credit sales, what is the bad debt expense for 2019? Select one: a. $14,000 b. $2,500 c. $3,400 d. $5,300 2.On March 1, 2019 Suissie Company purchased a machine for $600,000. The machine was expected to have a 10-year useful life and $120,000...
Information follows for Carra Company: 1. The beginning-of-the-year Accounts Receivable balance was $25,000. 2. Net sales...
Information follows for Carra Company: 1. The beginning-of-the-year Accounts Receivable balance was $25,000. 2. Net sales for the year were $410,000. (Credit sales were $200,000 of the total sales.) Carra does not offer cash discounts. 3. Collections on accounts receivable during the year were $140,000. Required: (a) Prepare summary journal entries to record the items noted above. (b) Calculate Carra Company's accounts receivable turnover ratio for the year. How old is the average receivable in days? (c) Use the turnover...
The following information relates to a company’s accounts receivable: accounts receivable balance at the beginning of...
The following information relates to a company’s accounts receivable: accounts receivable balance at the beginning of the year, $360,000; allowance for uncollectible accounts at the beginning of the year, $25,000 (credit balance); credit sales during the year, $1,250,000; accounts receivable written off during the year, $16,000; cash collections from customers, $1,150,000. Assuming the company estimates bad debts at an amount equal to 3% of credit sales. 1. Calculate bad debt expense for the year. 2. Calculate the year-end balance in...
The following information relates to a company’s accounts receivable: accounts receivable balance at the beginning of...
The following information relates to a company’s accounts receivable: accounts receivable balance at the beginning of the year, $450,000; allowance for uncollectible accounts at the beginning of the year, $34,000 (credit balance); credit sales during the year, $1,700,000; accounts receivable written off during the year, $25,000; cash collections from customers, $1,850,000. Assuming the company estimates bad debts at an amount equal to 3% of credit sales. 1. Calculate bad debt expense for the year. 2. Calculate the year-end balance in...
If sales are $680,000 and the beginning and ending balances of Accounts Receivable are $34,400 and...
If sales are $680,000 and the beginning and ending balances of Accounts Receivable are $34,400 and $38,400, respectively, the cash collected from customers is: Multiple Choice $680,000. $641,600. $676,000. $684,000.
Accounts Receivable Problem Type I - PERCENTAGE OF SALES (OR INCOME STATEMENT APPROACH) For 2015, The...
Accounts Receivable Problem Type I - PERCENTAGE OF SALES (OR INCOME STATEMENT APPROACH) For 2015, The company reported the following: ?A/R beginning of Year = $ 20,000 ?Allowance at Beginning of year = $18,800?(Credit balance) ?Credit Sales = $ 91,250 ?Write-offs = $21,000 ?Cash collections = 80,000 ?Total expense = 70,000 1. The company estimates that be 12% of annual sales will be uncollected each year. What is the Bad Debt Expense for 2015 ? 2. What is the ending...
The following information relates to a company’s accounts receivable: accounts receivable balance at the beginning of...
The following information relates to a company’s accounts receivable: accounts receivable balance at the beginning of the year, $440,000; allowance for uncollectible accounts at the beginning of the year, $33,000 (credit balance); credit sales during the year, $1,650,000; accounts receivable written off during the year, $24,000; cash collections from customers, $1,800,000. Assuming the company estimates that future bad debts will equal 11% of the year-end balance in accounts receivable. 1. Calculate the year-end balance in the allowance for uncollectible accounts....
Calculating Cash Collections Problem 1 Accounts receivable at the beginning of the year are $900. Tenzing...
Calculating Cash Collections Problem 1 Accounts receivable at the beginning of the year are $900. Tenzing has a 30-day collection period. Calculate cash collections in each of the 4 quarters by completing the following: Problem 2 a-d; Accounts receivable at the beginning of the year are $900. Tenzing has a 45-day collection period. Calculate cash collections in each of the 4 quarters by completing the following: Q1 Q2 Q3 Q4 Beginning receivables 900 Sales 3200 4600 5800 6100 Cash Collections...
The following information relates to a company’s accounts receivable: gross accounts receivable balance at the beginning...
The following information relates to a company’s accounts receivable: gross accounts receivable balance at the beginning of the year, $370,000; allowance for uncollectible accounts at the beginning of the year, $26,000 (credit balance); credit sales during the year, $1,300,000; accounts receivable written off during the year, $17,000; cash collections from customers, $1,200,000. Assuming the company estimates that future bad debts will equal 9% of the year-end balance in accounts receivable. 1. Calculate bad debt expense for the year. 2. Calculate...
1. You have the following information: Accounts receivable                       $160,000 Total credit sales $2,500,000 Assume a 360...
1. You have the following information: Accounts receivable                       $160,000 Total credit sales $2,500,000 Assume a 360 day year and compute the receivables collection period. 2.Inventory conversion period 15 days Closing inventory $28,000 Compute C O G S (assuming a 360 day year). 3.Inventory conversion period                      68.2 days Receivables collection period 35.8 days Payables deferral period 24.6 days Compute the cash conversion cycle: 4.Inventory conversion period 55.8 days Days sales outstanding 23.9 days Days payables outstanding 32.5 days The cash conversion...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT