Home Corporation will open a new store on January 1. Based on experience from its other retail outlets, Home Corporation is making the following sales projections:

Cash SalesCredit Sales

January$60,000$40,000

February30,00050,000

March40,00060,000

April40,00080,000

Home Corporation estimates that 70% of the credit sales will be collected in the month following the month of sale, with the balance collected in the second month following the month of sale.

Based on these data, the balance in accounts receivable on January 31 will be:

$40,000

$28,000

$12,000

$58,000