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On October 31, 2020, JP Company engaged in the following transactions: Obtained a P500, 000, six month loan from BDO, discounted at 12%. The company pledged P500, 000 of accounts receivable as security for the loan. Factored P1, 000 000 of accounts receivable without recourse on a non notification basis with Meow Company. Meow charged a factoring fee of 2% of the amount of receivables factored and withheld 10% of the amount factored. What is the total cash received from the financing of receivables? * a. 1 320 000 b. 1 350 000 c. 1 380 000 d. 1 470 000

On October 31, 2020, JP Company engaged in the following transactions: Obtained a P500, 000, six month loan from BDO, discounted at 12%. The company pledged P500, 000 of accounts receivable as security for the loan. Factored P1, 000 000 of accounts receivable without recourse on a non notification basis with Meow Company. Meow charged a factoring fee of 2% of the amount of receivables factored and withheld 10% of the amount factored. What is the total cash received from the financing of receivables? * a. 1 320 000 b. 1 350 000 c. 1 380 000 d. 1 470 000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On October 31, 2020, JP Company engaged in the following transactions: Obtained a P500, 000, six month loan from BDO, discounted at 12%. The company pledged P500, 000 of accounts receivable as security for the loan. Factored P1, 000 000 of accounts receivable without recourse on a non notification basis with Meow Company. Meow charged a factoring fee of 2% of the amount of receivables factored and withheld 10% of the amount factored. What is the total cash received from the financing of receivables? *

a. 1 320 000

b. 1 350 000

c. 1 380 000

d. 1 470 000

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