Question
On September 1, 2016, Shutterfly Inc. factored (sold) receivables with a carrying amount of $260,000 to Pippin Company. Pippin Company retains 10% of the receivables
On September 1, 2016, Shutterfly Inc. factored (sold) receivables with a carrying amount of $260,000 to Pippin Company. Pippin Company retains 10% of the receivables and assesses a finance charge of 4% of the receivables. Assume that the receivables were sold with recourse. If the retained receivables have a fair value of $17,000 and the recourse obligation has a fair value of $2,700, what is the loss to be reported on September 1, 2016 by Shutterfly Inc.?
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Managerial Accounting
Authors: Ray H Garrison, Alan Webb, Theresa Libby
11th Canadian Edition
1259275817, 978-1259275814
