2. On May 14, 2024, Gilbert Enterprises Inc. factored receivables with Sullivan Company. The receivables are factored on a with recourse basis. The following information pertains to the arrangement: Carrying value of the receivables factored Finance charge Amount withheld by factor for sales returns and allowances Fair value of recourse obligation $ 64,910 4% 5% $ 974 Gilbert Enterprises Inc. and Sullivan Company both follow ASPE. Required: 1. 2. Prepare the journal entry required by Gilbert Enterprises Inc. to account for the factoring arrangement Prepare the journal entry required by Sullivan Company to account for the factoring arrangement

2. On May 14, 2024, Gilbert Enterprises Inc. factored receivables with Sullivan Company. The receivables are factored on a with recourse basis. The following information pertains to the arrangement: Carrying value of the receivables factored Finance charge Amount withheld by factor for sales returns and allowances Fair value of recourse obligation $ 64,910 4% 5% $ 974 Gilbert Enterprises Inc. and Sullivan Company both follow ASPE. Required: 1. 2. Prepare the journal entry required by Gilbert Enterprises Inc. to account for the factoring arrangement Prepare the journal entry required by Sullivan Company to account for the factoring arrangement

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 12E: Inferring Accounts Receivable Amounts At the end of 2019, Karras Inc. had a debit balance of 141,120...

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