At the beginning of 2019, Statewide Delivery Company has the following account balances:
Accounts Receivable $44,000 (debit balance)
Allowance for Bad Debts $8000 (credit balance)
Bad Debts Expense $0
During the year, credit sales amounted to $800,000. Cash collected on credit sales amounted to $780,000, and $16,000 has been written off. At the end of the year, the company adjusted for bad debts expense using the percent-of-sales method and applied a rate, based on past history, of 3.5%. The ending balance of Accounts Receivable is ________.
A) $44,000
B) $48,000
C) $56,840
D) $16,000
B) $48,000
Explanation: Accounts Receivable beginning balance + Credit Sales - Collections - Write offs = $44,000 + $800,000 - $780,000 - $16,000 = $48,000
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