Accounts receivable in the amount of $500,000 were assigned to Grey Finance Company by Park

Inc. as collateral for a loan of $400,000. Grey charged a 1% finance fee on the accounts receivable

assigned and the interest rate on the note is 12%. During the month, Park collected $300,000

of the assigned accounts receivable and remitted this amount to Grey along with accrued interest.

Prepare the necessary journal entries to record the borrowing, the assignment of receivables, the

collection of the receivables, and the recognition of interest expense