Exercise 7-17

Kingbird Inc. factors receivables with a carrying amount of $233,500to Joffrey Company for $178,600on a with recourse basis.

The recourse provision has a fair value of $2,870. This transaction should be recorded as a sale.

Prepare the appropriate journal entry to record this transaction on the books of Kingbird Inc.(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.)

Account Titles and Explanation

Debit

Credit