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Item 8

Chez Fred Bakery estimates the allowance for uncollectible accounts at 3% of the ending balance of accounts receivable. During 2018, Chez Fred's credit sales and collections were $108,000 and $135,000, respectively. What was the balance of accounts receivable on January 1, 2018, if $160 in accounts receivable were written off during 2018 and if the allowance account had a balance of $750 on December 31, 2018?

Multiple Choice

• $35,000.
• $970.
• $52,160.
• None of these answer choices are correct.