During 2014, ABC Inc

Management Oct 16, 2020

During 2014, ABC Inc. had sales on account of $500,000, cash sales of $319,000, and collections on account of $216,000. In addition, they collected $6,900 which had been written off as uncollectible in 2013. As a result of these transactions the change in the accounts receivable indicates a

$603,000 increase

$596,100 increase

$284,000 increase

$277,100 increase

Expert Solution

Computation of Change in Accounts Receivable:

Change in Accounts Receivable = Sales on Account - Collection on Account

= $500,000 - $216,000

= $284,000 increase

So, the correct option is 3rd "$284,000 increase".

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