At the Beginning of 2015, Peter Dots Has the Following

question 129

Multiple Choice

At the beginning of 2015, Peter Dots has the following ledger balances: During the year, credit sales amounted to $800,000. Cash collected on credit sales amounted to $760,000, and $18,000 has been written off. At the end of the year, the company adjusted for bad debts expense using the percent-of-sales method and applied a rate, based on past history, of 2.5%. The ending balance of Accounts Receivable would be:

• A)$40,000.
• B)$62,000.
• C)$80,000.
• D)$18,000.

---

Definitions:

Specific Gravity

The ratio of the density of a substance to the density of a reference substance, typically water, at a specified temperature.

Volcanic Glass

A natural glass produced by the cooling and solidification of molten lava at a rate too rapid to permit crystallization.

Liquid Water

The liquid phase of H2O, existing at temperatures between 0°C and 100°C under standard atmospheric pressure, and vital for all known forms of life.

Minerals

Naturally occurring substances, usually inorganic, with a defined chemical composition and crystalline structure.