XYZ Company ended year 1 with accounts receivable of $100,000. On February 1, Year 2 XYZ provided services on account for $40,000. On May 1, Year 2 XYZ provided services for $20,000 cash. On November 1, Year 2 XYZ provided services on account for $70,000. What is the ending balance in accounts receivable as of December 31, Year 2?

Question

Business

Ronnie Dunlap

11 June, 04:49

XYZ Company ended year 1 with accounts receivable of $100,000. On February 1, Year 2 XYZ provided services on account for $40,000. On May 1, Year 2 XYZ provided services for $20,000 cash. On November 1, Year 2 XYZ provided services on account for $70,000. What is the ending balance in accounts receivable as of December 31, Year 2?

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Answers (1)

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Alicia Blackburn · Answer 1

Account at December 31th, Year 2: 210,000

Explanation:

We work this using the following reasoning

beginning accounts receivable

+ sales on accounts

Total amount to collect

- collection through the period

ending accounts receivable

year 2

beginning accounts receivable 100,000

+ February 1st sale on account 40,000

+ November 1st sale on account 70,000

total amount to collect 210,000

As we are not given with any data for collection we assume is zero.

Therefore ending AR balance:

210,000 - 0 = 210,000