Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Presented below is information for Pearl Company 1. 2. 3. Beginning-of-the-year Accounts Receivable balance was $20,900. Net sales (all on account for the year were

image text in transcribed

Presented below is information for Pearl Company 1. 2. 3. Beginning-of-the-year Accounts Receivable balance was $20,900. Net sales (all on account for the year were $105,300. Pearl does not offer cash discounts. Collections on accounts receivable during the year were $82,200. Pearl is planning to factor some accounts receivable at the end of the year. Accounts totaling $10,300 will be transferred to Credit Factors, Inc. with recourse. Credit Factors will retain 5% of the balances for probable adjustments and assesses a finance charge of 4%. The fair value of the recourse obligation is $1,012. Your answer is partially correct. Prepare the journal entry to record the sale of the receivables. (If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Loss on Sale of Receivables Due from Factor Recourse Llability 1012 Accounts Receivable eTextbook and Media List of Accounts X Your answer is incorrect. Compute Pearl's accounts receivable turnover for the year, assuming the receivables are sold. (Round answers to 2 decimal places, eg. 4.57.) Accounts receivable turnover times Days to collect accounts receivable days eTextbook and Media List of Accounts

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions