Mountain High Ice Cream Company reports under IFRS. Mountain High transferred $$68,000$ of accounts receivable to the Prudential

Bank. The transfer was made with recourse. Prudential remits $85\%$ of the factored amount to Mountain High and retains $15\%$ to cover

sales returns and allowances. When the bank collects the receivables, it will remit to Mountain High the retained amount $($which

Mountain estimates has a fair value of $$5,800.$ Mountain High anticipates a $$3,800$ recourse obligation. The bank charges a $1\%$ fee

of $$68,000),$ and requires that amount to be paid at the start of the factoring arrangement. Mountain High has transferred control over

the receivables, but determines that it still retains substantially all risks and rewards associated with them.

Required:

Prepare the journal entry to record the transfer on the books of Mountain High, considering whether the sale criteria under IFRS have

been met.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.

Journal entry worksheet

$1$

Record the transfer of accounts receivable.

Note: Enter debits before credits.