On january 1, 2017, the accounts receivable of martha company had a debit balance of $ 200 comma 000. during january, the company provided services for $ 700 comma 000 on account. the company collected $ 240 comma 000 from its customers on account in january. what was the ending balance in the accounts receivable account at the end of january?

$660,000

Explanation:

Accounts receivables are assets and accordingly, they have debit balance.

The opening balance of accounts receivables = $200,000

Add: Services provided on account = $700,000

Services provided on account is the revenue generated and the payment will be received in future, and thus, will create accounts receivables.

The company collected $240,000 from the accounts receivables, this means with this amount the balance of amount to be received from customers will be decreased.

Accordingly $240,000 amount of accounts receivables will be credited against cash account.

Ending balance of accounts receivables in January = Opening + Addition - Payment received

= $200,000 + $700,000 - $240,000 = $660,000

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