On July 31, Konrad International had $125,900 of accounts receivable. Prepare journal entries to record the following August transactions. Also, prepare any footnotes to the August 31 financial statements that should be reported as a result of these transactions.
2014
Aug. 2 Sold merchandise to customers on credit, $6,295. Cost of sales was $3,150.
7 Sold $18,770 of accounts receivable to Fidelity Bank. Fidelity charges a 1.5% fee.
15 Received payments from customers, $3,436
25 Borrowed $10,000 from Fidelity Bank, pledging $14,000 of accounts receivable as security for the loan