Reference no: EM132691286

Your accounts receivable clerk, Mitra Adams, to whom you pay a salary of $1,530 per month, has just purchased a new Cadillac. You have decided to test the accuracy of the accounts receivable balance of $85,650 shown in the general ledger.

The following information is available for your first year in business:

1. Collections from customers are $196,300.
2. Merchandise purchased totalled $321,800.
3. Ending merchandise inventory is $98,250.
4. Goods are marked to sell at 40% above cost.

Problem (a) Estimate the ending balance of accounts receivable from customers that should appear in the ledger and any apparent shortages. Assume that all sales are made on account.