Use the Table for the Question(s)below

question 35

Multiple Choice

Use the table for the question(s) below.
Pro Forma Income Statement for Ideko,2005-2010
-With the proper changes it is believed that Ideko's credit policies will allow for an account receivables days of 60.The forecasted accounts receivable for Ideko in 2006 is closest to:

• A)$19,690
• B)$16,970
• C)$22,710
• D)$14,525

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Definitions:

Contra-Revenue Account

An account in the general ledger that reduces the total gross revenues reported by the business, including returns, allowances, and discounts.

Sales Discounts

Reductions in the price of goods or services offered to customers to encourage prompt payment or as part of a sales promotion.

Control Account

An account used in the general ledger to summarize transactions detailed in subsidiary ledgers for efficient reporting and verification purposes.

Subsidiary Ledger

A detailed ledger that contains the transaction details of accounts like accounts receivable or payable, which are summarized in the general ledger.