Problem S-18 (IAA) During the second year of operations, Fauna Company itself in financial dificulties. The entity decided t contin nue acpounts receivable as a means of obtaining cash to operations On July 1, 2019, the entity sold P1.500,000 of a receivable for cash proceeds of P1.390,000. No bad de allow ance was associated with these accounts. On December 15, 2019, the entity assigned the remainde the accounts receivable, P5.000,000 as of that date. ,s collateral on a P2,500,000, 12% annual interest rate loan. The entity received P2, 500,000 less a 2% finance charge. Non. of the assigned accounts had been collected by the end of the year Allowance for bad debts before adjustment, 12/31/2019 Estimated uncollectible, 12/31/2019 Accounts factored and assigned accounts, 12/31/2019 Accounts receivable-assigned Accounts receivable-factored 100.0 1096 ofaccounts receivable receivable not including 1,000,000 5,000,000 1,500,000 1. What is the total amount of cash received from the financing of accounts receivable during the year? a. 3,840,000 b. 1.390,000 c. 3,890,000 d. 3,540,000 of accounts receivable should be 2. What total amount reported as current assets on December 31, 2019? a. 6,000,000 b. 1,000,000 c. 5,000,000 d. 7,500,000 3. What is the bad debt expense for the current year? a. 600,000 b. 500,000 c. 650,000 d. 750,000 224