Problem 3 On February 1, 2020 Kaw Tan Company casually factored receivables with a carrying value of P500,000 to Kring Krong. Kring Krong assessed 3% of the total receivables as finance charge and retains 5% of the uncollected factored accounts for any adjustment and returns in any excess. Kaw Tan has always maintained a 10% allowance for doubtful accounts. Cash proceeds of Kaw Tan from factoring was P400,000. By the end of February 2020, half of the factored accounts were collected. In March 2020, customers returned goods costing P50,000 and it is the policy of Kaw Tan to maintain 20% gross profit on cost. Customers owing P60,000 paid within the discount period and relevant term was 2/30, n/45. By the end of March 2020, all factored receivables were collected. Prepare the journal entries in the books of Kaw Tan.