If the actual A/R at the end of February was $12,000 and projected sales in March are $50,000, where 70% of sales are on credit, 60% of credit sales are collected in the month of the sale, and 40% are collected in the month after the sale, what is the projected A/R balance on the pro forma balance sheet for the end of March?
A) $14,000
B) $48,000
C) $20,000
D) $35,000

Question

Quizplus · Accepted Answer

A/R Bal. end of March = A/R from March sales
= (40% of March credit sales)
= ($35,000 × 0.4) = $14,000, all of February's AR balance should be collected in March.

If the Actual A/R at the End of February Was