contestada

Pina Colada Furniture factors $670000 of receivables to Sheffield Factors, Inc. Sheffield Factors assesses a 2% service charge on the amount of receivables sold. Pina Colada Furniture factors its receivables regularly with Sheffield Factors. What journal entry does Pina Colada make when factoring these receivables

Respuesta :

Answer and Explanation:

The journal entry is shown below;

Cash $656,600

Factoring charges (2% of $670,000)  $13,400

            To Trade Receivables $670,000

(Being recording these receivables)

Here cash and factory charges is debited as it increased the assets and expense while the trade receivable is credited as decreased the assets

Otras preguntas