Samson Wholesale Beverage Company regularly factors its accounts receivable with the Milpitas Finance Company. On April 30, 2024, the company transferred $850,000 of accounts receivable to Milpitas. The transfer was made without recourse. Milpitas remits 90% of the factored amount and retains 10%. When Milpitas collects the receivables, it remits to Samson the retained amount less a 5% fee (5% of the total factored amount). Samson estimates the fair value of the last 10% of its receivables to be $62,000. Required: Prepare the journal entry for Samson Wholesale Beverage for the transfer of accounts receivable on April 30, assuming the sale criteria are met. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet 1 Record the transfer of accounts receivable on April 30. Note: Enter debits before credits. Event 1 Record entry General Journal Clear entry Debit Credit View general journal
Samson Wholesale Beverage Company regularly factors its accounts receivable with the Milpitas Finance Company. On April 30, 2024, the company transferred $850,000 of accounts receivable to Milpitas. The transfer was made without recourse. Milpitas remits 90% of the factored amount and retains 10%. When Milpitas collects the receivables, it remits to Samson the retained amount less a 5% fee (5% of the total factored amount). Samson estimates the fair value of the last 10% of its receivables to be $62,000. Required: Prepare the journal entry for Samson Wholesale Beverage for the transfer of accounts receivable on April 30, assuming the sale criteria are met. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet 1 Record the transfer of accounts receivable on April 30. Note: Enter debits before credits. Event 1 Record entry General Journal Clear entry Debit Credit View general journal
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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Manji
Transcribed Image Text:Samson Wholesale Beverage Company regularly factors its accounts receivable with the Milpitas Finance Company. On April 30,
2024, the company transferred $850,000 of accounts receivable to Milpitas. The transfer was made without recourse. Milpitas remits
90% of the factored amount and retains 10%. When Milpitas collects the receivables, it remits to Samson the retained amount less a 5%
fee (5% of the total factored amount). Samson estimates the fair value of the last 10% of its receivables to be $62,000.
Required:
Prepare the journal entry for Samson Wholesale Beverage for the transfer of accounts receivable on April 30, assuming the sale
criteria are met.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
View transaction list
Journal entry worksheet
1
Record the transfer of accounts receivable on April 30.
Note: Enter debits before credits.
Event
1
Record entry
General Journal
Clear entry
Debit
Credit
>
View general journal
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