General accounting question Berkeley Manufacturing sells $180,000 of receivables to Finance Plus, Inc. on a withrecourse basis. Finance Plus assesses a finance charge of 6% and retains an amount equalto 5% of accounts receivable. Berkeley estimates the fair value of the recourse liability tobe $5,500. Prepare the journal entry for Berkeley to record the sale.

Accounts Receivable Sold = $180,000Finance Charge (6%) = $180,000 × 6% = $10,800Retained Amount (5%)…

Answered: Berkeley Manufacturing sells $180,000…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Libby Inc. sold $500,000 of accounts receivable to Reliable Finance on a with recourse basis. Reliable Finance assesses a 4.5% finance charge on the amount of accounts receivable and retains an amount equal to 7% of accounts receivable for possible adjustments. Prepare the journal entries for Libby Incorporated and Reliable Finance to record the sale of the accounts receivable to Reliable Finance assuming that the recourse liability has a fair value of $16,000.
Wood Incorporated factored $150,000 of accounts receivable with Engram Factors Inc. on a with recourse basis. Engram assesses a 2% finance charge of the amount of accounts receivable and retains an amount equal to 6% of accounts receivable for possible adjustments. Prepare the journal entry for Wood to record the sale, assuming that the recourse liability has a fair value of $7,500. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Pearl Woodcrafters sells $227,500 of receivables to Commercial Factors, Inc. on a with recourse basis. Commercial assesses a finance charge of 6% and retains an amount equal to 5% of accounts receivable. Pearl estimates that the recourse liability has a fair value of $4,695 instead of $9,390 estimated earlier. Prepare the journal entry for Pearl to record the sale. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit What are the effects of this change in the value of the recourse liability on Pearl's financial statements? Pearl's income will be * by $ Pearl's will be * by $
Vaughn Incorporated sold $166,000 of accounts receivable to Gannon Factors Inc. on a with recourse basis. Gannon assesses a 2% finance charge of the amount of accounts receivable and retains an amount equal to 6% of accounts receivable for possible adjustments. Prepare the journal entries for Vaughn Incorporated and Gannon Factors to record the sale of the accounts receivable to Gannon assuming that the recourse liability has a fair value of $9,100. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Vaughn Incorporated Gannon Factors
Accounting Arness woodcrfters .
Blossom Incorporated sold $200,000 of accounts receivable to Ayayai Factors Inc. on a with recourse basis. Ayayai assesses a 2% finance charge of the balance of accounts receivable and retains an amount equal to 6% of accounts receivable for possible adjustments. Prepare the journal entries for Blossom Incorporated and Ayayai Factors to record the sale of the accounts receivable to Ayayai, assuming that the recourse liability has a fair value of $10,000. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Account Titles and Explanation Blossom Incorporated Avayai Factors Inc. Debit LI Credit
J Hotheads Unlimited sold $440,000 of accounts receivable to Frozen Factors Inc. on a with recourse basis. Frozen assesses an 11% finance charge of the amount of accounts receivable and retains an amount equal to 8% of accounts receivable to cover probable adjustments. Prepare the journal entry for Hotheads to record the sale of the accounts receivable to Frozen assuming that the recourse liability has a fair value of $26,000
Wood Incorporated factored $150,000 of accounts receivable with Engram Factors Inc. on a without-recourse basis. Engram assesses a 2% finance charge of the amount of accounts receivable and retains an amount equal to 6% of accounts receivable for possible adjustments. Prepare the journal entry for Wood Incorporated and Engram Factors to record the factoring of the accounts receivable to Engram.
The controller for Concord Corporation has reached an agreement with Riverbed Financing Ltd. to sell a large portion of Concord’s past-due accounts receivable. Concord agrees to sell $1,840,000 of accounts receivable to Riverbed with recourse. Concord’s controller estimates that the fair value of Concord’s liability to pay Riverbed for uncollectible accounts is $165,000. Riverbed will charge Concord 8% of the total receivables balance as a financing fee, and will withhold an initial amount of 9%.Calculate the net proceeds and the gain or loss on the disposal of receivables to Riverbed Financing Ltd. Net proceeds $ ( Loss / Gain ) on disposal of receivables $ Prepare the journal entry on the books of Concord Corporation to record the disposal of receivables to Riverbed Financing Ltd. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the…
Carla Vista Co. sells $647,600 of receivables with a fair value of $659,400 to Carla Vista Trust in a securitization transaction that meets the criteria for a sale. Carla Vista Co. receives full fair value for the receivables and agrees to continue to service them, estimating that the fair value of this service liability component is $26,930. Prepare the journal entry for Carla Vista Co. to record the sale.
The controller for Bramble Corporation has reached an agreement with Sheffield Financing Ltd. to sell a large portion of Bramble's past-due accounts receivable. Bramble agrees to sell $1,820,000 of accounts receivable to Sheffield with recourse. Bramble's controller estimates that the fair value of Bramble's liability to pay Sheffield for uncollectible accounts is $163.000. Sheffield will charge Bramble 9% of the total receivables balance as a financing fee, and will withhold an initial amount of 10% (a) Calculate the net proceeds and the gain or loss on the disposal of receivables to Sheffield Financing Ltd. Net proceeds ✓on disposal of receivables S $
The controller for Riverbed Corporation has reached an agreement with Concord Financing Ltd. to sell a large portion of Riverbed's past-due accounts receivable. Riverbed agrees to sell $1,950,000 of accounts receivable to Concord with recourse. Riverbed's controller estimates that the fair value of Riverbed's liability to pay Concord for uncollectible accounts is $177,000. Concord will charge Riverbed 7% of the total receivables balance as a financing fee, and will withhold an initial amount of 8%. (a) - Your answer is partially correct Calculate the net proceeds and the gain or loss on the disposal of receivables to Concord Financing Ltd Net proceeds 1657500 Loss on disposal of receivables $ 233500 i

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS