Needham Corporation has a $200,000 balloon mortgage payment due in early August. To meet its obligation, it
Question:
Required:
1. Prepare all necessary journal entries made by Needham.
2. Show the balance sheet presentation of the assigned accounts receivable and any related liabilities at August 31.
3. Prepare all necessary journal entries made by Needham assuming these changes in the given scenario:
a. The transaction qualifies under U.S. GAAP as a sale with recourse.
b. The assessed monthly finance charge increases the Loss on sale of receivables account and is offset by a credit to Due from factor.
c. Although Needham has guaranteed the transferred accounts, their high quality makes nonpayment unlikely.
GAAP
Generally Accepted Accounting Principles (GAAP) is the accounting standard adopted by the U.S. Securities and Exchange Commission (SEC). While the SEC previously stated that it intends to move from U.S. GAAP to the International Financial Reporting Standards (IFRS), the... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Related Book For
Financial Reporting and Analysis
ISBN: 978-0078025679
6th edition
Authors: Flawrence Revsine, Daniel Collins, Bruce, Mittelstaedt, Leon
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