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17 July, 06:07

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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  1. 17 July, 09:08
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    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
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