Question

Tripod Inc. began the month with accounts receivable of $25,000. During the month, it collected $12,000 from customers and sold $5,000 of merchandise on credit. What is its accounts receivable balance at the end of the month?

Answer 1

Answer:

Accounts receivable balance at the end of the month is $18,000

Explanation:

Accounts receivable balance at the end of the month = Accounts receivable balance at the beginning of the month + Accounts receivable increased during the month - Accounts receivable decreased during the month.

During the month, Tripod Inc. collected $12,000 from customers. Accounts receivable decreased during the month of $12,000

It sold $5,000 of merchandise on credit. Accounts receivable increased during the month of $5,000

Accounts receivable balance at the end of the month = $25,000 + $5,000 - $12,000 = $18,000