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Damm [24]
3 years ago
5

A company factored $40,000 of its accounts receivable and was charged a 3% factoring fee. The journal entry to record this trans

action would include a:
Multiple Choice
a. Debit to Cash of $40,000 and a credit to Accounts Receivable of $40,000.
b. Debit to Cash of $38,800, a debit to Factoring Fee Expense of $1,200, and a credit to Accounts Receivable of $40,000.
c. Debit to Cash of $40,000 and a credit to Notes Payable of $40,000.
d. Debit to Cash of $41,200 and a credit to Accounts Receivable of $41,200.
e. Debit to Cash of $40,000, a credit to Factoring Fee Expense of $1,200, and a credit to Accounts Receivable of $38,800.
Business
1 answer:
bezimeni [28]3 years ago
3 0

Answer:

Correct answer is B, Debit cash $38,800, debit factoring fee expense $1,200 and a credit of Accounts receivable of $40,000

Explanation:

Factoring is one way to raise fund for immediate use of the company. It is a way to sell accounts receivable of the company. The above-mentioned problem is to sell accounts receivable (factored) with the corresponding factoring fee of 3% and that is $1,200 (40,000 x 3%). In effect of this fee, the company will receive cash less than the amount of its accounts receivable sold. The company will record the inflow of cash at $38,800 (40,000 - 3%) and will also recognize an expense incurred during the factoring in the amount of $1,200 and finally will credit the sold accounts receivable in the amount of $40,000.

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Which category of environmental forces in international marketing would involve: Coors Brewery attempting to sell its beer in Ir
romanna [79]

Answer:

Competitive Forces

Explanation:

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Coors Brewery attempting to sell its beer in Ireland competing against Guiness Beer... Or attempting to sell its beer in Australia competing against Fosters beer is an example of Competitive Forces because by attempting to sell its beer in either of Ireland or Australia to compete with Guiness Beer or Fosters Beer, there will be competition in the Industry, thus, the larger the number of equivalent product and services offered, the lesser the power of a company.

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3 0
3 years ago
Read 2 more answers
Several years ago, Walters Company issued bonds with a face value of $1,000,000 at par. As a result of declining interest rates,
Pavel [41]

Answer:

Walter company Journal $

Date

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Explanation:

The bond investment account is kept fixed at the amount at which it was subscribe, the corresponding interest are debited to income statement on payment to the bond holders.

In the same vein the retirement of the bond at a premium represents an expenses to the firm which has to be debited to the income statement on payment to the bond holders.

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Answer:

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8 0
2 years ago
Prepare adjusting journal entries, as needed, for the following items.
podryga [215]

Answer:

Explanation:

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CHECK THE ATTACHMENT FOR THE PREPARED JOURNAL

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