What Amount Should Halloran Report for Accounts Receivable at December 31, 2024?
Calculation of Accounts Receivable Balance before Allowances
Accounts Receivable Balance, 1/1/2024: $850,000
Credit Sales for 2024: $3,390,000
Accounts Receivable Written Off During 2024: $61,000
Collections from Customers During 2024: $3,020,000
Allowance for Uncollectible Accounts Balance, 12/31/2024: $204,000
To determine the accounts receivable balance before allowances on December 31, 2024, we need to subtract the collections from customers and the accounts receivable written off from the credit sales for 2024.
Accounts Receivable Balance = Accounts Receivable Balance, 1/1/2024 + Credit Sales for 2024 - Collections from Customers During 2024 - Accounts Receivable Written Off During 2024
Accounts Receivable Balance = $850,000 + $3,390,000 - $3,020,000 - $61,000
Accounts Receivable Balance = $159,000
Therefore, Halloran should report an accounts receivable balance, before allowances, of $159,000 at December 31, 2024.