The Following Information Is from the 2013 Records of Armadillo

question 53

Multiple Choice

The following information is from the 2013 records of Armadillo Camera Shop: $$\begin{array} { | l | r | } \hline \text { Accounts receivable, December 31,2013 } & \$ 20,000 \text { (debit) } \\\hline \begin{array} { l } \text { Allowance for uncollectible accounts, December 31,2013 } \\\text { prior to adjustment }\end{array} & 600 \text { (debit) } \\\hline \text { Net credit sales for 2013 } & 95,000 \\\hline \text { Accounts written off as uncollectible during 2013 } & 7,000 \\\hline \text { Cash sales during 2013 } & 27,000 \\\hline\end{array}$$
- Uncollectible accounts expense is estimated by the percent-of-sales method.Management estimates that 3% of net credit sales will be uncollectible.Which of the following will be the amount of net Accounts receivable after adjustment?

• A) $16,550
• B) $17,750
• C) $17,150
• D) $13,000

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Definitions:

Stockholders' Equity

The ownership interest of shareholders in a corporation, represented by the company’s assets minus its liabilities.

Earnings Per Share

A financial ratio calculated by dividing a company's net income by its number of outstanding shares, indicating the profitability per share.

Earnings Per Share

A financial metric that indicates the portion of a company's profit allocated to each outstanding share of common stock.

Financing Activities

Transactions that result in changes in the size and composition of the equity capital or borrowings of the company.