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Flounder Incorporated factored $160,400 of accounts receivable with Engram Factors Inc. on a with recourse basis. Engram assesses a 2% finance charge of the amount
Flounder Incorporated factored $160,400 of accounts receivable with Engram Factors Inc. on a with recourse basis. Engram assesses a 2% finance charge of the amount of accounts receivable and retains an amount equal to 5% of accounts receivable for possible adjustments. Prepare the journal entry for Flounder to record the sale, assuming that the recourse liability has a fair value of $7,260.
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