Answer:
The journal entries are shown below:
Explanation:
Cash $149,040
Due from factor $11,592   ($165,600 × 3%)
Loss on sale of receivables $4,968    ($165,600 × 3%)
         To Account receivable    $165,600
(Being the factoring of account receivable is recorded)
Account receivable    $165,600
        To Due from factor $11,592   ($165,600 × 3%)
         To Cash $149,040
        To Gain on sale of receivables $4,968    ($165,600 × 3%)
(Being the factoring of account receivable is recorded)
Only these entries are passed