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ABC Incorporated factored $200,000 of accounts receivable with Factors Inc. on a with recourse basis. Factor assesses a 4% finance charge of the amount of
ABC Incorporated factored $200,000 of accounts receivable with Factors Inc. on a with recourse basis. Factor assesses a 4% finance charge of the amount of accounts receivable and retains an amount equal to 5% of accounts receivable for possible adjustments. Prepare the journal entry for ABC to record the sale, assuming that the recourse liability has a fair value of $9,000.
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