Task: The following information from Tiny Company's first year of operations is to be used in testing the accuracy of Accounts Receivable. The December 31, 2008, balance is $28,300.
(a) Collections from customers, $48,000.
(b) Merchandise purchased, $74,000.
(c) Ending merchandise inventory, $31,500.
(d) Goods sell at 60% above cost.
(e) All sales are on account.
Compute the balance that Accounts Receivable should show and determine the amount of any shortage or overage.