Pina Colada Corp. manufactures sweaters for sale to athletic-wear retailers. The following information is available for Pina for the years ended December 31,2022 and 2023 : During 2023 , Pina had the following transactions: 1. On June 1,2023 , sales of $85,000 to a major customer were settled, with Pina accepting an $85,000, one-year note bearing 6% interest that is payable at maturity. The $85,000 is not included in the total credit sales amount above. 2. Pina factors some accounts receivable at the end of the year. Accounts totalling $70,000 are transferred to Kingbird Inc., with recourse. Kingbird retains 5% of the balance for possible returns and will receive the collections directly from Pina's customers. Pina is assessed a finance charge of 6% on this transfer. The fair value of the recourse obligation is $6,000. 3. Pina wrote off $3,500 of accounts receivable during 2023 . 4. Based on the latest available information, the 2023 allowance for doubtful accounts should have a balance of $12,700 at December 31, 2023. Additional information: Included in the cash balance at December 31,2023 , are the following: a chequing account with a balance of $9,800, postage stamps of $100, petty cash of $400, coins and currency on hand of $3,000, and postdated cheques from customers of $2,700. Pina is a private company that follows ASPE. (a) Prepare the journal entry for the sale to the customer from June 1. (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.) Pina Colada Corp. manufactures sweaters for sale to athletic-wear retailers. The following information is available for Pina for the years ended December 31,2022 and 2023 : During 2023 , Pina had the following transactions: 1. On June 1,2023 , sales of $85,000 to a major customer were settled, with Pina accepting an $85,000, one-year note bearing 6% interest that is payable at maturity. The $85,000 is not included in the total credit sales amount above. 2. Pina factors some accounts receivable at the end of the year. Accounts totalling $70,000 are transferred to Kingbird Inc., with recourse. Kingbird retains 5% of the balance for possible returns and will receive the collections directly from Pina's customers. Pina is assessed a finance charge of 6% on this transfer. The fair value of the recourse obligation is $6,000. 3. Pina wrote off $3,500 of accounts receivable during 2023 . 4. Based on the latest available information, the 2023 allowance for doubtful accounts should have a balance of $12,700 at December 31, 2023. Additional information: Included in the cash balance at December 31,2023 , are the following: a chequing account with a balance of $9,800, postage stamps of $100, petty cash of $400, coins and currency on hand of $3,000, and postdated cheques from customers of $2,700. Pina is a private company that follows ASPE. (a) Prepare the journal entry for the sale to the customer from June 1. (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.)
