Cascadia Products uses the aging method for its accounts receivable. On January 1, 2020, the balance in the allowance for doubtful accounts was $320,000. For the year ended December 31, 2020, Cascadia made $6,450,000 of credit sales, wrote off $250,000 of accounts as uncollectible, and recovered $12,000 that had been written off in the prior year. The aging analysis at the end of 2020 indicates the estimated uncollectible accounts total $350,000. During the year, the company issued a note receivable.

Required:

a. Record the year-end adjusting entry to record bad debts expense.

b. During 2020, Cascadia factored $500,000 of its receivables without recourse. The factor paid Cascadia $440,000 cash. Show the journal entry to record this transaction.

c. Cascadia also factored $800,000 of its receivables with recourse. The factor paid Cascadia $750,000 cash after deducting a holdback of $30,000 for potential uncollectible accounts. Show the journal entry to record this transaction.

d. Cascadia loaned $300,000 to a customer to finance the purchase of goods from Cascadia on January 1, 2018. The customer was to pay Cascadia on December 31, 2020, the principal plus the market rate of interest at 12% compounded annually. No payments were due during the three-year period. At the end of 2020, Cascadia and the customer renegotiated the terms of the loan such that the total amount originally due would be due at the end of 2022. Show the journal entry to record the loan restructuring on Cascadia’s books.