Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Bramble Corp. is a growing company whose ability to raise capital has not been growing as quickly as its expanding assets and sales. Bramble Corp.'s
Bramble Corp. is a growing company whose ability to raise capital has not been growing as quickly as its expanding assets and sales. Bramble Corp.'s local banker has indicated that the company cannot increase its borrowing for the foreseeable future. Bramble Corp.'s suppliers are demanding payment for goods acquired within 30 days of the invoice date, but Bramble Corp's customers are slow in paying for their purchases (60-90 days). As a result, Bramble Corp. has a cash flow problem. Bramble Corp. needs $168,600 to cover next Friday's payroll. Its balance of outstanding accounts receivable totals $771,000. To alleviate this cash crunch, the company sells $182,300 of its receivables. Record the entry that Bramble Corp. would make. (Assume a 2% service charge.) (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Cash 390 Service Charge Expense 9,000 Accounts Receivable 2948
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started