During Year 1, Ramona Department Store had total sales of $3,000,000, of which 80% were on credit. The beginning balance in Accounts Receivable (on January 1 of Year 1) was $165,000. The beginning balance in the Allowance for Bad Debts (on January 1 of Year 1) was $20,000. The amount of accounts written off as
uncollectible during the year was $27,000.
The following aging of Accounts Receivable is for Ramona Company at the end of Year.
Aging of Accounts Receivable December 31 of Year 1
Less than 31 days to 61 days to Over
Overall 30 days 60 days 90 days 90 days
Total $492,000 $366,000 $72,000 $24,000 $30,000
Ramona Company has developed the following bad debt information from its own past experience. Percent Ultimately
Age of Account Uncollectible
Less than 30 days 2
31 to 60 days 12
61 to 90 days 35
Over 90 days 90
How much CASH was collected from CREDIT CUSTOMERS during the year?
a. $2,073,000
b. $2,721,000
c. $2,400,000
d. $2,370,000
e. $2,424,000
f. $2,046,000