On September 4, 2021, Halifax Corporation factored receivables with a carrying amount of $577,200 with Vancouver Inc.

Vancouver Inc. assessed a finance charge of 3% of the receivables and retained 4% of the receivables.

Halifax Corporation follows ASPE, and has a year end of November 30.

Required:

1. Prepare the journal entry required on the books of Halifax Corporation on September 4, 2021 for the disposal of the receivables. Assume that the receivables are factored on a without recourse basis. (2 marks)
2. Prepare the journal entry required on the books of Halifax Corporation on September 4, 2021 for the disposal of the receivables. Assume that the receivables are factored on a with recourse basis, and that the recourse obligation has a fair value of $11,390. (3 marks)