CornProducts Corp. ended the year 2018 with an average collection period of 40 days. The firm's credit sales for 2018 were $9 million. What is the approximate year-end 2018 balance in accounts receivable for Corn Products?
A) $225,000
B) $986,300
C) $4,444,400
D) $360,000,000

Question

Quizplus · Accepted Answer

The year-end balance in accounts receivable can be calculated using the formula: (Average Collection Period / 365 days) * Credit Sales. Plugging in the values: (40 / 365) * $9,000,000 = $986,301.37, which is approximately $986,300.