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16. A company factors $2,000,000 of its accounts receivables with recourse for a finance charge of 4%. The finance company retains an amount equal to
16. A company factors $2,000,000 of its accounts receivables with recourse for a finance charge of 4%. The finance company retains an amount equal to 8% of the accounts receivable for possible adjustments. Management of the company estimates the fair value of the recourse liability at $200,000. Prepare the journal entry(ies) (in T-account format) to recognize this scenario.
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