Philip Corp Reported Credit Sales of $240,000 and Write-Offs of Bad

question 16

Multiple Choice

Philip Corp reported credit sales of $240,000 and write-offs of bad debts of $57,000 for last year. Accounts receivable had a balance of $1,127,000 at the beginning of the year and $881,000 at the end of the year. How much cash was collected from customers during the year?

• A)$246,000
• B)$429,000
• C)$486,000
• D)$669,000

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Definitions:

Subrogation

The legal process by which one party assumes the rights of another party to recover debts or damages paid on their behalf.

Surety

A surety refers to a person or entity that takes responsibility for another's performance of an undertaking, for example, guaranteeing the payment of a debt.

Prepayment

The act of repaying a loan or part of a loan before its due date, which can sometimes lead to penalties or the waiving of future interest.

Collateral

refers to assets that are pledged as security for the repayment of a loan, ensuring the lender can seize the assets if the loan is not repaid.