For 2021, Rahal's Auto Parts estimates bad debt expense at 1% of credit sales. The company reported accounts receivable and an allowance for uncollectible accounts of $89.500 and $2.700, respectively, at December 31, 2020. During 2021. Rahal's credit sales and collections were $410,000 and $414,000, respectively, and $2.940 in accounts receivable were written oft Rahal's 2021 bad debt expense is Multiple Choice $2.700 52.940 14340 On June 1, Parson Assoc. sold equipment to Arleo and agreed to accept a 3-month, $53,000, 10% interest-bearing note in payment at a time when the prevailing rate of interest for similar transactions was 10%. When the note was collected upon maturity, Parson would recognize interest revenue of Multiple Choice $0 $1325 52.550 $3.975 On June 30, 2021, Blondie Fixtures was considering alternatives to bolster its cash position Option One called for transferring $440,000 in accounts receivable to Dogwood Finance Company without recourse for a 4% fee. Option Two calls for Blondie to transfer the $440,000 in receivables to Dogwood with recourse. Dogwood's charges a 3% fee for receivables factored with recourse Option Two meets the conditions to be considered a sale, but Blondie estimates a $3,400 recourse lability. Under either option, Dogwood will immediately remit 90% of the factored receivables to Blondie, and retain 10%. When Dogwood collects the remaining receivables, it remits the amount, less the fee, to Blondie. Blondie estimates that the fair value of the final 10% of the receivables is $27,000 (ignoring the factoring fee). Required: 1. Prepare any necessary Journal entry or entries if receivables are factored under Option One. 2. Prepare any necessary journal entry or entries if receivables are factored under Option Two Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare any necessary journal entry or entries if receivables are factored under Option One. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 > On December 1, 2021, General Mole borrowed $400,000 at 12% Interest and pledged $500,000 in accounts receivable as collateral Additionally, General Mole was charged a finance fee equal to 1% of the accounts receivable assigned. At the end of December $300,000 of the assigned receivables were collected and remitted to the lender along with accrued interest. Required: Prepare journal entries to record the borrowing, the assignment of receivables, the collection on the receivables, and the recognition of interest expense. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field) View transaction list Journal entry worksheet 2 3 Record the borrowing, assignment of receivables. Note: Enter debits before credits. General Journal Debit Credit Transaction 1
