Please Help With Accounting Exercise E7-20 enclosed in images is exercises please complete on Microsoft Excel. Thank You.
CHAPTER 7 Cash and Receivables 399 E7-18 Assigning of On June 30, 2018, the High Five Surfboard Company had outstanding accounts receivable of $600,000. On July specific accounts 1. 2018, the company borrowed $450,000 from the Equitable Finance Corporation and signed a promissory note. receivable Interest at 10% is payable monthly. The company assigned specific receivables totaling $600.000 as collateral for LO7-8 the loan. Equitable Finance charges a finance fee equal to 1.8% of the accounts receivable assigned. Required: Prepare the journal entry to record the borrowing on the books of High Five Surfboard. E 7-19 Mountain High Ice Cream Company transferred $60,000 of accounts receivable to the Prudential Bank. The trans- Factoring fer was made without recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10%. of accounts When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountain receivable estimates has a fair value of $5,000) less a 2% fee (2% of the total factored amount). without recourse Required: LO7-8 Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met. E 7-20 [This is a variation of E 7-19 modified to focus on factoring with recourse.] Factoring Mountain High Ice Cream Company transferred $60,000 of accounts receivable to the Prudential Bank. The trans of accounts fer was made with recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10% receivable with to cover sales returns and allowances. When the bank collects the receivables, it will remit to Mountain High recourse the retained amount (which Mountain estimates has a fair value of $5,000). Mountain High anticipates a $3,000 . LO7-8 recourse obligation. The bank charges a 2% fee (2% of $60,000), and requires that amount to be paid at the start of the factoring arrangement. Required: Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met. E7-21 This is a variation of E 7-20 modified to focus on factoring with recourse under IFRS.] Factoring Mountain High Ice Cream Company reports under IFRS. Mountain High transferred $60,000 of accounts receiv- of accounts able to the Prudential Bank. The transfer was made with recourse. Prudential remits 90% of the factored amount receivable with to Mountain High and retains 10% to cover sales returns and allowances. When the bank collects the receivables. recourse under it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5.000). Moun- IFRS tain High anticipates a $3,000 recourse obligation. The bank charges a 2% fee (2% of $60,000), and requires that . LO7-8, LO7-10 amount to be paid at the start of the factoring arrangement. Mountain High has transferred control over the receiv ables, but determines that it still retains substantially all risks and rewards associated with them. IFRS Required: Prepare the journal entry to record the transfer on the books of Mountain High, considering whether the sale cri- teria under IFRS have been met. E7-22 Selkirk Company obtained a $15,000 note receivable from a customer on January 1. 2018. The note, along with Discounting a interest at 10%, is due on July 1, 2018. On February 28, 2018, Selkirk discounted the note at Unionville Bank. Th note receivable bank's discount rate is 12%. .. LO7-8 Required
