BE7.9 (LO 5) On October 1, 2020, Chung, Inc. assigns $1,000,000 of its accounts receivable to Seneca National Bank as collateral for a $750,000 note. The bank assesses a finance charge of 2% of the receivables assigned and interest on the note of 9%. Prepare the October 1 journal entries for both Chung and Seneca.
BE7.9 (LO 5) On October 1, 2020, Chung, Inc. assigns $1,000,000 of its accounts receivable to Seneca National Bank as collateral for a $750,000 note. The bank assesses a finance charge of 2% of the receivables assigned and interest on the note of 9%. Prepare the October 1 journal entries for both Chung and Seneca.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:BE7.9 (LO 5) On October 1, 2020, Chung, Inc. assigns $1,000,000
of its accounts receivable to Seneca National Bank as collateral
for a $750,000 note. The bank assesses a finance charge of 2%
of the receivables assigned and interest on the note of 9%.
Prepare the October 1 journal entries for both Chung and
Seneca.
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