Brief Exercise 7-9

On October 1, 2017, Waterway, Inc. assigns $1,033,100 of its accounts receivable to Wildhorse National Bank as collateral for a $716,300 note. The bank assesses a finance charge of 3% of the receivables assigned and interest on the note of 10%. Prepare the October 1 journal entries for both Waterway and Wildhorse. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)