Vaughn Corporation factors $275,100 of accounts receivable with Kathleen Battle Financing, Inc. on a with recourse...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Vaughn Corporation factors $275,100 of accounts receivable with Kathleen Battle Financing, Inc. on a with recourse basis. Kathleen Battle Financing will collect the receivables. The receivables records are transferred to Kathleen Battle Financing on August 15, 2025. Kathleen Battle Financing assesses a finance charge of 2% of the amount of accounts receivable and also reserves an amount equal to 4% of accounts receivable to cover probable adjustments. (b) Assume that the conditions are met for a transfer of receivables with recourse to be accounted for as a sale. Prepare the journal entry on August 15, 2025, for Vaughn to record the sale of receivables, assuming the recourse obligation has a fair value of $3,670. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation Aug. 15, 2025 Cash Loss on Sale of Receivables Recourse Liability Accounts Receivable Debit 258594 11004 9172 Credit 3670 275100 Vaughn Corporation factors $275,100 of accounts receivable with Kathleen Battle Financing, Inc. on a with recourse basis. Kathleen Battle Financing will collect the receivables. The receivables records are transferred to Kathleen Battle Financing on August 15, 2025. Kathleen Battle Financing assesses a finance charge of 2% of the amount of accounts receivable and also reserves an amount equal to 4% of accounts receivable to cover probable adjustments. (b) Assume that the conditions are met for a transfer of receivables with recourse to be accounted for as a sale. Prepare the journal entry on August 15, 2025, for Vaughn to record the sale of receivables, assuming the recourse obligation has a fair value of $3,670. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation Aug. 15, 2025 Cash Loss on Sale of Receivables Recourse Liability Accounts Receivable Debit 258594 11004 9172 Credit 3670 275100
Expert Answer:
Related Book For
Intermediate Accounting
ISBN: 9781119790976
18th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
Students also viewed these accounting questions
-
Moreover, the analyst wanted to figure out whether there are some associations among various categories. So, the following tables were produced, see table 4. Table 4: Linear Regression coefficients...
-
Functional relations are a result of controlled experiments. The experiment will show a change in the dependent variable consistently as a result of changes or manipulations of the independent...
-
What's a shipper account application? AO A packet of information that you give to potential clients. BO CO A request from a consignee to do business with you. Written permission from a potential...
-
Consider the utility function U(x 1 , x 2 ) = x 1 x 2 with budget constraint p 1 x 1 + p 2 x 2 = c. (a) Show that the maximum of U(x 1 , x 2 ) subject to the budget constraint is equal to c 2 /(4p 1...
-
Let Aj, 1 < i < 5, be the domains for a table D A1 A2 A3 A4 A5, where A1 = {U, V, W, X, Y, Z} (used as code names for different cereals in a test), and A2 = A3 = A4 = A5 = Z+. The table D is...
-
This question asks you about the way in which the performance of I/0 systems has changed and requires you to carry out your own research. Plot the maximum speed per data transfer as a function of...
-
\(\frac{10}{\sqrt{6}+7}\) Rationalize the denominator of the fraction, and then simplify the fraction.
-
Crystal Displays Inc. recently began production of a new product, flat panel displays, which required the investment of $ 1,500,000 in assets. The costs of producing and selling 5,000 units of flat...
-
Jane and Bill Collins have total take-home pay of $7,250 amonth. Their monthly expenses total $5,500. Calculate the minimumamount this couple needs to establish an emergency fund. 2 answers
-
Over the last few months, there has been an increase in the level of debate about why students should study Accounting Information System (AIS). As an AIS student, you have been asked to add your...
-
As of December 31, 2022, Sandy Beach had $9,500,000 in 3 percent serial bonds outstanding. Cash of $509,000 is the debt service fund's only asset as of December 31, 2022, and there are no...
-
You have $2,000 and want to invest in two savings goals: a short-term goal (less than one year) of saving for textbooks during your first year of community college, and a longer-term goal (over 1...
-
P2. A rental property has $400 per month of net rental income (not including financing costs). You buy similar property based on a valuation multiple of 108 x Net monthly rental income. What is the...
-
Using the image below, explain why average total cost must be rising if marginal cost is above average total cost. Costs $3.00 2.50 2.00 150 1.50 100 1.00 0.50 MC ATC AVC AFC 2 4 6 8 10 12 14...
-
Mrs. Carole Cofftey, a 46 -year-old health iaformation technologist with two children who is complaining of pain in her breasts. You are to obtain a mammogram on Ms. Coffey using paralletplate...
-
Consider a 12 percent (annual) coupon bond that matures in 3 years, has a par value of 1000, and pays coupon semiannually. Suppose that currently this bond is available in the market for 1000....
-
A bubble-point liquid feed is to be distilled as shown in Figure. Use the Edmister group method to estimate the mole-fraction compositions of the distillate and bottoms. Assume initial overhead and...
-
At January 1, 2025, Langley Companys outstanding shares included the following. 280,000 shares of $50 par value, 7% cumulative preferred stock 900,000 shares of $1 par value common stock Net income...
-
Clydesdale Corporation has a cumulative temporary difference related to depreciation of $580,000 at December 31, 2025. This difference will reverse as follows: 2026, $42,000; 2027, $244,000; and...
-
Earnhart Corporation has outstanding 3,000,000 shares of common stock with a par value of $10 each. The balance in its Retained Earnings account at January 1, 2025, was $24,000,000, and it then had...
-
What would you think about a company whose stock was selling for \($50\) a share in January and \($12\) a share in December?
-
Because a publicly traded company receives money only when its stock is originally issued, why do you think it would care about the stocks market value in the stock market? Assume you own stock in a...
-
When you consider that companies are generally in business to earn a profit, why might it be acceptable to select a capital project that promises a return that is just equal to the weighted average...
Study smarter with the SolutionInn App