Lonergan Company occasionally uses its accounts receivable to obtain immediate cash. At the end of June 2016, the company had accounts receivable of $1,080,000. Lonergan needs approximately $650,000 to capitalize on a unique investment opportunity. On July 1, 2016, a local bank offers Lonergan the following two alternatives: a. Borrow $650,000. sign a note payable, and assign the entire receivable balance as collateral. At the end of each month, a remittance will be made to the bank that equals the amount of receivables collected plus 12% interest on the unpaid balance of the note at the beginning of the period b. Transfer $700,000 of specific receivables to the bank without recourse. The bank will charge a 3% factoring fee on the amount of receivables transferred. The bank will collect the receivables directly from customers. The sale criteria are met. Transfer $700,000 of specific receivables to the bank without recourse. The bank will charge a 3% factoring fee on the amount of receivables transferred. Note: Enter debits before credits Date General Journal Debit Credit July 01, 2016 Cash Note payable 700,000 Record entry Clear entry View general journal Journal entry worksheet Record the collection of receivables, assuming that 90% of all June 30 receivables are collected on July 31. The bank will collect the transferred receivables directly Note: Eniter debts before credits. Date General Journal Debit Credit July 31.2016 Recoed entry Clear entry iew general journal