On April 1, 2017, Indigo Company assigns $520,500of its accounts receivable to the Third National Bank as collateral for a $340,400loan due July 1, 2017. The assignment agreement calls for Indigo to continue to collect the receivables. Third National Bank assesses a finance charge of3% of the accounts receivable, and interest on the loan is10% (a realistic rate of interest for a note of this type).

On July 1, 2017, Indigo paid Third National all that was due from the loan it secured on April 1, 2017. Prepare the journal entry to record this payment.