Oral Corporation's beginning accounts receivable were $200,000 and ending accounts receivable were $270,000. During the period $500,000 cash was collected from customer credit sales. Calculate the amount of Oral Corporation sales on account during the period.
a. 470,000
b. $680,000
c. $570,000
d. $770,000
To calculate the amount of Oral Corporation sales on account during the period, we need to determine the change in accounts receivable.
The change in accounts receivable can be calculated by subtracting the beginning accounts receivable from the ending accounts receivable:
Change in accounts receivable = Ending accounts receivable - Beginning accounts receivable
Change in accounts receivable = $270,000 - $200,000
Change in accounts receivable = $70,000
Now, we can calculate the sales on account by adding the change in accounts receivable to the cash collected from customer credit sales:
Sales on account = Cash collected from customer credit sales + Change in accounts receivable
Sales on account = $500,000 + $70,000
Sales on account = $570,000
Therefore, the amount of Oral Corporation sales on account during the period is $570,000. The correct answer is option c. $570,000.