During 2014 Sedgewick Inc. had sales on account of $264,000, cash sales of $108,000, and collections on account of $168,000. In addition, they collected $2,900 which had been written off as uncollectible in 2013. As a result of these transactions the change in the accounts receivable balance indicates a
A) $201,100 increase.
B) $ 96,000 increase.
C) $ 93,100 increase.
D) $204,000 increase.

Question

Quizplus · Accepted Answer

The change in accounts receivable is calculated as: Sales on account ($264,000) - Collections on account ($168,000) = $96,000 increase. The collection of $2,900 written off does not affect the accounts receivable balance for 2014.