Propel Fly reported opening balances of $1,712,000 in accounts receivable and $147,000 in the allowance for doubtful accounts at the beginning of last year. During the year, sales on account totaled $2,500,000, collections of accounts receivable were $1,300,000, bad debt write-offs were $65,000 and bad debt expense was $89,000. What was the ending balance in accounts receivable?

Question

Quizplus · Accepted Answer

Beginning balance of accounts receivable = $1,712,000
Sales on account = $2,500,000
Collections of accounts receivable = $1,300,000
Bad debt write-offs = $65,000
Bad debt expense = $89,000

To find out the ending balance of accounts receivable, we need to subtract the total collections and bad debt write-offs from the beginning balance of accounts receivable, and then add the bad debt expense.

Beginning balance - collections - write-offs + bad debt expense = ending balance
$1,712,000 - $1,300,000 - $65,000 + $89,000 = $2,847,000

Therefore, the ending balance in accounts receivable is $2,847,000. The correct answer is D.

Propel Fly Reported Opening Balances of $1,712,000 in Accounts Receivable