Please provide explanation and solution for my guidance thank you ?? Take time to answer ? Im not in a rush :)
Problem Problem 8-13 (IAA) On Decem Freeway Company provides financing to other entities by accounts purchasing accounts receivable on a nonrecourse basis. P4, 000, 00 continue Freeway Company charges the clients a commission of 15% In addition on all accounts receivable factored a 5% fina In addition, Freeway Company withholds 10% of accounts accounts receivable factored as protection against sales returns or The Dece other adjustments. amounted Freeway Company credits the 10% withheld to Clients Retainer account and makes payments to clients at the end On Decen of each month so that the balance in the retainer is equal to to the ban 10% of unpaid receivables at the end of the month. 31, 2020 Experience has led Freeway Company to establish an The entity allowance for doubtful accounts of 4% of all unpaid accounts accounts receivable purchased. 1. What On December 1, Freeway Company purchased accounts of acco receivable from Motorway Company totaling P3,000,000. a. 4,0 Motorway Company had previously established an allowance b. 3,8 for doubtful accounts for the accounts receivable at P100,000. C. 4,7 d. 3,7 By December 31, Freeway Company had collected P2,500,000 on the accounts receivable. 2. What i Required: 31, 202 a. 1,8 1. Prepare journal entries to record the transactions on the books of Motorway Company (seller of accounts b. 2, 14 receivable). C. 2,24 d. 2,2 2. Prepare journal entries on the books of Freeway Company (factor or buyer of accounts receivable). 3. What a Compa b. 260 C. 400 244 d. 360 760tities by Problem 8-14 (IAA) asis. On December 1, 2020, Solvent Company assigned specific n of 15% accounts receivable totaling P5,000,000 as collateral on a P4,000,000 12% note from a certain bank. The entity will continue to collect the assigned accounts receivable. accounts In addition to the interest on the note, the bank also charged turns or a 5% finance fee deducted in advance on the assigned accounts. Clients The December collections of assigned accounts receivable the end amounted to P2,000,000 less cash discount of P200,000. equal to On December 31, 2020, the entity remitted the collections to the bank in payment for the interest accrued on December 31, 2020 and the note payable. blish an accounts The entity accepted sales returns of P100,000 on the assigned accounts and wrote off assigned accounts of P300,000. 1. What amount of cash was received from the assignment accounts of accounts receivable on December 1, 2020? 0,000. a. 4,000,000 080 llowance b. 3,800,000 100,000. C . 4, 750,000 d. 3,750,000 AAD 24-6 moldon't 2,500,000 2. What is the carrying amount of note payable on December 31, 2020? a. 1,840,000 b. 2, 140,000 c. 2,240,000 ns on the d. 2,200,000 accounts 3. What amount should be disclosed as the equity of Solvent Company in as y in assigned accounts on December 31, 2020? Freeway a. 260,000 1900 098 . le). b. 400,000 C . 360,000 400 081 d. 760,000 000.908 245
