Question:

The beginning balance in Accounts Receivable on Company A$\text{'}$s Year $2$ Balance Sheet is $$20,000$ and the ending balance is $$110,000.$ Cash collections from customers are $$105,000,$ and an account for a customer owing $$5,000$ was written off because the company didn$$t think the customer would pay. What is the Sales on account during Year $2$ on the Year $2$ Income Statement? Assuming no other transactions affected the account during the year.

Hint: you may find it helpful to use a t$-$account as you work through this question.

Answers:

$$190,000$

$$215,000$

$$195,000$

$$200,000$