On November 30, Petrov Co. has $151,700 of accounts receivable and uses the perpetual inventory system.

Dec.		4		Sold $5,525 of merchandise (that had cost $3,536) to customers on credit, terms n/30.
		9		Sold $21,238 of accounts receivable to Main Bank. Main charges a 6% factoring fee.
		17		Received $3,039 cash from customers in payment on their accounts.
		27		Borrowed $12,136 cash from Main Bank, pledging $15,777 of accounts receivable as security for the loan.

(1) Prepare journal entries to record the above transactions.

• 1

  Sold $5,525 of merchandise to customers on credit, terms n/30.

• 2

  Record the cost of goods sold, $3,536.

• 3

  Sold $21,238 of accounts receivable to Main Bank. Main charges a 6% factoring fee.

• 4

  Received $3,039 cash from customers in payment on their accounts.

• 5

  Borrowed $12,136 cash from Main Bank.

• 6

  Pledged $15,777 of accounts receivable as security for the loan.

(2) Which transaction would most likely require a note to the financial statements?

Journal entry worksheet