g Boulder Beaver Company had a $150,000 beginning balance in Accounts Receivable and a $6,000 credit balance in the Allowance for Doubtful Accounts. During the year, credit sales were $600,000 and customers' accounts collected were $590,000. Also, $4,000 in worthless accounts were written off. What was the net amount of receivables included in the current assets at the end of the year, before any provision was made for doubtful accounts

Question

Hugh Lucero

Business

12 July, 19:47

g Boulder Beaver Company had a $150,000 beginning balance in Accounts Receivable and a $6,000 credit balance in the Allowance for Doubtful Accounts. During the year, credit sales were $600,000 and customers' accounts collected were $590,000. Also, $4,000 in worthless accounts were written off. What was the net amount of receivables included in the current assets at the end of the year, before any provision was made for doubtful accounts

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Nicholas Weiss · Answer 1

The net amount of receivables to be included in the current assets at the end of the year is $154,000

Explanation:

Beginning balance in Accounts Receivable = $150,000

Add: Credit sales made = $600,000

Less: amount collected against customer's accounts = $590,000

Less: accounts written off = $4000

Gross balance in Accounts Receivable = $156,000

Beginning balance in the Allowance for Doubtful Accounts = $6,000

Less: Accounts written off adjusted with Allowance for Doubtful accounts = $4000

Closing balance = $2000

Net Accounts Receivable = $156,000-$2000 = $154,000