Arness Woodcrafters sells $230,100 of receivables to Commercial Factors, Inc. on a with recourse basis. Commercial assesses a finance charge of 6% and retains an amount equal to 5% of accounts receivable. Arness estimates that the recourse liability has a fair value of $4,745.

Account Title & Explaination	Debit	Credit

accounts:

Accounts Payable Accounts Receivable Advertising Expense Allowance for Doubtful Accounts Bad Debt Expense Cash Cash Over and Short Due from Factor Due to Customer Discount on Notes Payable Discount on Notes Receivable Freight-In Freight-Out Gain on Disposal of Land Interest Expense Interest Payable Interest Receivable Interest Revenue Inventory Land Loss on Sale of Receivables Miscellaneous Expenses No Entry Notes Payable Notes Receivable Office Expense Owner's Drawings Petty Cash Postage Expense Purchase Discounts Recourse Liability Sales Discounts Sales Discounts Forfeited Sales Revenue Service Revenue Supplies Supplies Expenses Unearned Sales Revenue