Question
On October 1, 2020, Kingbird, Inc. assigns $1.8 million of its accounts receivable to Alberta Provincial Bank as collateral for a $2.3-million loan evidenced by
On October 1, 2020, Kingbird, Inc. assigns $1.8 million of its accounts receivable to Alberta Provincial Bank as collateral for a $2.3-million loan evidenced by a note. The bank's charges are as follows: a finance charge of 3% of the assigned receivables and an interest charge of 11% on the loan. Prepare the October 1 journal entries for both Kingbird and Alberta Provincial Bank. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
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