Smart Art Is a New Establishment

question 88

Multiple Choice

Smart Art is a new establishment. During the first year, there were credit sales of $40,000 and collections of credit sales of $36,000. One account for $650 was written off. The company decided to use the percent-of-sales method to account for bad debts expense, and decided to use a factor of 2% for their year-end adjustment of bad debts expense. At the end of the year, what is the ending balance in Accounts Receivable?

• A)$4,000
• B)$3,600
• C)$3,350
• D)$3,200

---

Definitions:

Third-force Perspective

A psychological framework that emphasizes human potential and self-actualization, often associated with humanistic psychology.

Human Potential

The inherent ability or capacity for growth, development, and achievement present within each person.

Self-realization

The process of fully understanding and realizing one's own potential, abilities, or character.

Self-determination

The process by which a person controls their own life and makes decisions independently, often linked to motivation and personal growth.