Question 3 Prepare the journal entries required to record each of the following cases. (Each situation is independent.) 1. To obtain additional cash, Misumi factors without recourse of $20,000 of accounts receivable with Stills Finance. The finance charge is 10% of the amount factored. 2. To obtain a one-year notes payable $55,000, Misumi pledged the $65,000 of specific receivable accounts to Obihiro Financial. The finance charge is 8% of the loan. 3. Based on an aging analysis, an allowance of impairment of receivable $5,800 should be reported. Assume the allowance currently has a credit balance of $1,100.
Question 3 Prepare the journal entries required to record each of the following cases. (Each situation is independent.) 1. To obtain additional cash, Misumi factors without recourse of $20,000 of accounts receivable with Stills Finance. The finance charge is 10% of the amount factored. 2. To obtain a one-year notes payable $55,000, Misumi pledged the $65,000 of specific receivable accounts to Obihiro Financial. The finance charge is 8% of the loan. 3. Based on an aging analysis, an allowance of impairment of receivable $5,800 should be reported. Assume the allowance currently has a credit balance of $1,100.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Question 3
Prepare the journal entries required to record each of the following cases. (Each
situation is independent.)
1. To obtain additional cash, Misumi factors without recourse of $20,000 of
accounts receivable with Stills Finance. The finance charge is 10% of the amount
factored.
2. To obtain a one-year notes payable $ 55,000, Misumi pledged the $65,000 of
specific receivable accounts to Obihiro Financial. The finance charge is 8% of the
loan.
3. Based on an aging analysis, an allowance of impairment of receivable $5,800
should be reported. Assume the allowance currently has a credit balance of
$1,100.
Question 4
Bohannon SA factors $ 250,000 of accounts receivable with Winkler Financing,
without recourse basis. Winkler Financing will collect the receivables. The receivables
0010 Winklor Financing
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