FCB Corporation began its fiscal year 2023 with a balance of $475,000 in the Trade Receivables account and a balance of $33,000 in the Allowance for Doubtful Accounts. During 2023, FCB had credit sales of $6,675,000.
Also during the year, the company wrote off $35,500 of accounts receivable that were deemed to be uncollectible, although one customer whose $4,000 account had been written off that same year surprised management by paying the amount in full in late September. The total cash collected throughout 2023 amounted to $6,568,500, which includes the surprise $4,000. FCB’s objective is to collect its receivables every 30 days (the industry’s average collection period is 32 days).
In preparation for the audited year-end financial statements, the controller prepared the following list of trade receivables at December 31, 2023, grouped by age: