On December 1 of the current year, Jordan Inc. assigns $125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a $750 service fee, advances 80% of Jordans accounts receivable and charges an annual interest rate of 6% on any outstanding loan balance.

On December 31, Jordan Inc. received $30,000 on assigned accounts.

Required:

Prepare Jordans journal entries to record the cash receipt and the payment to McLaughlin.