Microsoft develops, produces, and markets a wide range of computer software, including the Windows operating system. On its recent financial statements, Microsoft reported the following information about net sales revenue and accounts receivable (amounts in millions).

According to its Form 10-K, Microsoft recorded bad debt expense of $116 and there were no bad debt recoveries during the current year.

Required:
1. What amount of bad debts was written off during the current year?
2. Based on your answer to requirement (1), solve for cash collected from customers for the current year, assuming that all of Microsoft’s sales during the period were on open account.

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Accounts receivable, net of allowances of $411 and $377 Net sales revenue Current Year $29,524 66,069 Prior Year $26,481 64,497