Part $2$

Now assume that on December $31,2023,$ Sheridan enters into the following transactions related to the company's receivables:

Sheridan sells the note receivable to Prairie Bank for $$60,000$ cash plus accrued interest. Given the creditworthiness of

Sheridan's customer, the bank accepts the note without recourse and assesses a finance charge of $3\mathrm{.}10\%.$ Prairie Bank

will collect the note directly from the customer.

Sheridan factors some accounts receivable at the end of the year. Accounts totalling $$35,000$ are transferred to Skysong,

Inc., with recourse. Skysong retains $5\%$ of the balances and assesses a finance charge of $4\%$ on the transfer. Skysong will

collect the receivables from Sheridan's customers. The fair value of the recourse obligation is $$4,700.$

Prepare the journal entry to record the transfer of the note receivable to Prairie Bank. $($Round answers to $0$ decimal places, e$.$g$.$

$8,971.$ Credit account titles are automatically indented when the 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. List all debit entries before credit entries.$)$

Account Titles and Explanation

Debit

Credit