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Balancing sheet

The following information is available for Small Corporation's first year of operations:

Payment for merchandise purchases $250,000
Ending merchandise inventory 110,000
Accounts payable (balance at end of year) 60,000
Collections from customers 225,000

The balance in accounts payable relates only to merchandise pur-
chases. All merchandise items were marked to sell at 40% above
cost. What should be the ending balance in accounts receivable,
assuming all accounts are deemed collectible?

Solution: (hint)

Purchases - $250,000
less inv -
Sales markup -

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Since this is the first year of operations and there were $225,000 of accounts receivable collected, one must compute total sales to determine the ending balance in ...

Solution Summary

The solution contains the determination of ending balance in accounts.