The controller forSheffieldCorporation has reached an agreement withBrambleFinancing Ltd. to sell a large portion ofSheffield's past-due accounts receivable.Sheffieldagrees to sell $1,970,000of accounts receivable toBramblewithout recourse.Sheffield's controller estimates that the fair value ofSheffield's liability to payBramblefor uncollectible accounts is $179,000.Bramblewill chargeSheffield9% of the total receivables balance as a financing fee, and will withhold an initial amount of10%.

Calculate the net proceeds and the gain or loss on the disposal of receivables toBrambleFinancing Ltd.

Net proceeds$ LossGain

on disposal of receivables$

Prepare the journal entry on the books ofSheffieldCorporation to record the disposal of receivables toBrambleFinancing Ltd.(Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation

Debit

Credit