Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Blossom Distributors is a growing company whose ability to raise capital has not been growing as quickly as its expanding assets and sales. Blossom's local

image text in transcribed
Blossom Distributors is a growing company whose ability to raise capital has not been growing as quickly as its expanding assets and sales. Blossom's local banker has indicated that the company cannot increase its borrowing for the foreseeable future. Blossom's suppliers are demanding payment for goods acquired within 30 days of the invoice date, but Blossom's customers are slow in paying for their purchases ( 6090 days). As a result, Biossom has a cash flow problem. Blossom needs $173,000 to cover next Friday's payroll. its balance of outstanding accounts receivable totals $820,000. To alleviate this cash crunch, the company sells $183,000 of its receivables. Record the entry that Blossom would make. (Assume a 3% service charge.) (Credit account titles are outomatically indented when amount is entered. Do not indent manually) Blossom Distributors is a growing company whose ability to raise capital has not been growing as quickly as its expanding assets and sales. Blossom's local banker has indicated that the company cannot increase its borrowing for the foreseeable future. Blossom's suppliers are demanding payment for goods acquired within 30 days of the invoice date, but Blossom's customers are slow in paying for their purchases ( 6090 days). As a result, Biossom has a cash flow problem. Blossom needs $173,000 to cover next Friday's payroll. its balance of outstanding accounts receivable totals $820,000. To alleviate this cash crunch, the company sells $183,000 of its receivables. Record the entry that Blossom would make. (Assume a 3% service charge.) (Credit account titles are outomatically indented when amount is entered. Do not indent manually)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions