Question 5 of 7< >-/ 1View PoliciesCurrent Attempt in ProgressPronghorn Corp. sold $700,000 of accounts receivable to Larkspur, Inc. on a without recourse basis under IFRS, as the risks andrewards have been transferred to Larkspur. The transaction meets the criteria for a sale, and no asset or liability components of thereceivables are retained by Pronghorn. Larkspur assesses a finance charge of 5% of the amount of accounts receivable and retainsan amount equal to 6% of accounts receivable.Prepare journal entries for both Pronghorn and Larkspur. (Credit account titles are automatically indented when amount is entered. Donot indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)Account Titles and ExplanationDebitCreditPronghornLarkspur Question 4 of 7< >- /1Current Attempt in ProgressOn January 1, Pronghorn Corp. lent $43,000 to Larkspur, Inc., accepting Larkspur's $57,233, three-year, zero-interest-bearing note.The implied interest is 10%.(a)Prepare Pronghorn's journal entries for the initial transaction, recognition of interest each year assuming use of the effectiveinterest method, and the collection of $57,233 at maturity. (Credit account titles are automatically indented when amount is entered. Donot indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)Account Titles and ExplanationDebitCredit(To record initial transaction)(To record interest income in the first year)(To record interest income in the second year)(To record interest income in the third year)(To record collection at maturity)!!

Pronghorn Corp. sold $700,000 of accounts receivable to Larkspur, Inc. on a without recourse basis under IFRS, as the risks and rewards have been transferred to Larkspur. The transaction meets the criteria for a sale, and no asset or liability components of the receivables are retained by Pronghorn. Larkspur assesses a finance charge of 5% of the amount of accounts receivable and retains an amount equal to 6% of accounts receivable. Prepare journal entries for both Pronghorn and Larkspur. (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 O for the amounts.)

Pronghorn Corp. sold $700,000 of accounts receivable to Larkspur, Inc. on a without recourse basis under IFRS, as the risks and rewards have been transferred to Larkspur. The transaction meets the criteria for a sale, and no asset or liability components of the receivables are retained by Pronghorn. Larkspur assesses a finance charge of 5% of the amount of accounts receivable and retains an amount equal to 6% of accounts receivable. Prepare journal entries for both Pronghorn and Larkspur. (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 O for the amounts.)

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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