Lazard Corporation has experienced cash flow problems and decides to improve its current cash position by factoring 30 of its receivables, without recourse, and assigning the remainder with the same finance company The factored receivables meet the conditions for a sale while the assigned receivables do not The agreement with the finance company stipulates that a 10 commission will be assessed on factored accounts, no service charge is assessed on the assigned accounts, and 15 annual interest will be charged on the outstanding note payable balance related to the assigned accounts Additionally, the finance company will advance only 80 of the factored and assigned accounts, and Lazard must continue the collection responsibilities on the assigned accounts At the beginning of the last month of the companys fiscal year, the accounts receivable transferred to the finance company amounted to $187,000 During the month, collections on factored accounts were $46,000, and collections on assigned accounts amounted to $84,000 All collections on assigned accounts plus accrued interest were remitted to the finance company at the end of the month The remaining amounts owed will be remitted within these months Required 1 Prepare all journal entries to record the preceding information on Lazards books 2 How would the accounts related to Lazards factoring and assignment agreements be reported on Lazards year end financial statements CHART OF ACCOUNTS Lazard Corporation General Ledger ASSETS 111 Cash 121 Accounts Receivable 123 Receivable from Factor 124 Accounts Receivable Assigned 141 Inventory 152 Prepaid Insurance 181 Equipment 198 Accumulated Depreciation LIABILITIES 211 Accounts Payable 221 Notes Payable 231 Salaries Payable 250 Unearned Revenue 261 Income Taxes Payable EQUITY 311 Common Stock 331 Retained Earnings REVENUE 411 Sales Revenue EXPENSES 500 Cost of Goods Sold 511 Insurance Expense 512 Utilities Expense 521 Salaries Expense 532 Bad Debt Expense 540 Interest Expense 541 Depreciation Expense 559 Miscellaneous Expenses 601 Loss on Sale of Receivable 910 Income Tax Expense Financial Statements Fill in Lazard's balance sheet and income statement for the accounts related to Lazard's factoring and assignment agreements at December 31, 2016 Lazard Corporation Partial Balance Sheet For the Year Ended December 31, 2016 Current assets Current liabilities Lazard Corporation Partial Income Statement December 31, 2016

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Lazard Corporation has experienced cash flow problems and decides to improve its current cash position by factoring 30% of its receivables, without recourse, and assigning

Lazard Corporation has experienced cash flow problems and decides to improve its current cash position by factoring 30% of its receivables, without recourse, and assigning the remainder with the same finance company. The factored receivables meet the conditions for a sale while the assigned receivables do not. The agreement with the finance company stipulates that a 10% commission will be assessed on factored accounts, no service charge is assessed on the assigned accounts, and 15% annual interest will be charged on the outstanding note payable balance related to the assigned accounts. Additionally, the finance company will advance only 80% of the factored and assigned accounts, and Lazard must continue the collection responsibilities on the assigned accounts. At the beginning of the last month of the companys fiscal year, the accounts receivable transferred to the finance company amounted to $187,000. During the month, collections on factored accounts were $46,000, and collections on assigned accounts amounted to $84,000. All collections on assigned accounts plus accrued interest were remitted to the finance company at the end of the month. The remaining amounts owed will be remitted within these months.

	Required:
1.	Prepare all journal entries to record the preceding information on Lazards books.
2.	How would the accounts related to Lazards factoring and assignment agreements be reported on Lazards year-end financial statements?

CHART OF ACCOUNTS

Lazard Corporation

General Ledger

	ASSETS
111	Cash
121	Accounts Receivable
123	Receivable from Factor
124	Accounts Receivable Assigned
141	Inventory
152	Prepaid Insurance
181	Equipment
198	Accumulated Depreciation

	LIABILITIES
211	Accounts Payable
221	Notes Payable
231	Salaries Payable
250	Unearned Revenue
261	Income Taxes Payable

	EQUITY
311	Common Stock
331	Retained Earnings

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	REVENUE
411	Sales Revenue

	EXPENSES
500	Cost of Goods Sold
511	Insurance Expense
512	Utilities Expense
521	Salaries Expense
532	Bad Debt Expense
540	Interest Expense
541	Depreciation Expense
559	Miscellaneous Expenses
601	Loss on Sale of Receivable
910	Income Tax Expense

Financial Statements Fill in Lazard's balance sheet and income statement for the accounts related to Lazard's factoring and assignment agreements at December 31, 2016. Lazard Corporation Partial Balance Sheet For the Year Ended December 31, 2016 Current assets Current liabilities: Lazard Corporation Partial Income Statement December 31, 2016