Question - For the month of December, the records of Balin Corporation show the following information:
Cash received on accounts receivable .................. $ 70,000
Cash sales ............................................ 60,000
Accounts Receivable, December 1 ....................... 160,000
Accounts Receivable, December 31 ...................... 148,000
Accounts Receivable written off as uncollectible ...... 2,000
The corporation uses the direct write-off method in accounting for uncollectible accounts receivable. What are the gross sales for the month of December?
A) $118,000
B) $120,000
C) $130,000
D) $144,000
Please explain why the answers are incorrect and why the correct one is right.