Question
Plugwell Inc. is an advertising agency that bills its clients $300 per hour. Invoices are usually sent only when a project is completed. A recent
Plugwell Inc. is an advertising agency that bills its clients $300 per hour. Invoices are usually sent only when a project is completed. A recent job required 20 hours in May, 25 hours in June, and 5 more hours in July to complete the project. Plugwells client paid the full amount in August. What will Plugwell show as its accounts receivable balance for this project, at the end of each of those four months, respectively?
A $6,000 at the end of May; $7,500 at the end of June; $1,500 at the end of July; and nothing at the end of August.
B Nothing at the end of May, June, or August; $15,000 at the end of July when the invoice was sent.
C $15,000 at the end of May, June and July; nothing at the end of August.
D $6,000 at the end of May; $13,500 at the end of June; $15,000 at the end of July; and nothing at the end of August.
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