ABC, Inc. has a beginning receivables balance on January 1 st of $660. Sales for

Question

ABC, Inc. has a beginning receivables balance on January 1st of $660. Sales for January through April are $420, $450, $530 and $550, respectively. The accounts receivable period is 60 days. How much did the firm collect in the month of March? Assume that a year has 360 days.

$550

$530

$450

$660

$420

ABC, Inc. has a beginning receivables balance on January 1st of $660. Sales for January through April are $420, $450, $530 and $550, respectively. The accounts receivable period is 60 days. How much did the firm collect in the month of March? Assume that a year has 360 days.

Explanation / Answer

The Firm will collect $660 in march.

Account receivables period of 60 days shows that Account receivables generally pay after 60 days.

It means In march we will receive the balance of january 1st (before 60 days) which is $660.

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