Carlton Company Reported on Its Income Statement Sales for the Year

question 39

Multiple Choice

Carlton Company reported on its income statement sales for the year just ended of $435,000.Sales during the year adjusted to the cash basis on its statement of cash flows constructed using the direct method were $460,000.Carlton Company recorded the following account balances: Based on this information,the balance in Accounts Receivable at the beginning of the year was:

• A)$60,000
• B)$63,000
• C)$59,000
• D)$10,000

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Definitions:

Sales

The process of selling goods or services in exchange for money or other compensation.

Supplier Relationship

The interaction and management of connections between a company and the businesses that supply the materials or services it uses in its operations.

Verbal Understandings

Agreements or terms reached through spoken communication, which may not be formally documented in writing.

Existing Business

A company or enterprise that has been operational for some time, as opposed to a newly established entity.