On April 30, Victor Services had an Accounts Receivable balance of $40,000. During the month of May, total credits to Accounts Receivable were $76,000 from customer payments. The May 31 Accounts Receivable balance was $33,000. What was the amount of credit sales during May

Question

Business

Sabrina Shaffer

16 May, 09:16

On April 30, Victor Services had an Accounts Receivable balance of $40,000. During the month of May, total credits to Accounts Receivable were $76,000 from customer payments. The May 31 Accounts Receivable balance was $33,000. What was the amount of credit sales during May

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Answers (2)

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Bizzy · Answer 1

Credit sales = $69,000

Explanation:

Accounts receivable is a transit account that is used to show revenue that is owed to the business by other parties such as vendors.

The portion of accounts receivable that is collected contributes to profits, while the portion that is not collectible results in loss to the business.

When customers pay the balance in the account reduces, while when credit sales are made the balance increases.

Final balance of account receivable = Opening balance + credit sales - customer payments

33,000 = 40,000 + credit sales - 76,000

Credit sales = 33,000 + 76,000 - 40,000

Credit sales = $69,000

Carly Finley · Answer 2

Credit sales is $69,000

Explanation:

Account receivables can be defined as the amount of money owed by customers to a company because it is convertible to cash in the future. The company is entitled to receive the money because it has provided a product or service.

The amount of credit sales can be calculated as:

Final balance of account receivable = Opening balance + credit sales - customer payments

Final balance = 33,000

Opening balance = 40,000

Customer payment = 76,000

Credit sales is unknown

33,000 = 40,000 + credit sales - 76,000

Make credit sales the subject of the formular

Credit sales = 33,000 + 76,000 - 40,000

Credit sales = $69,000

Therefore the credit sales is $69,000.