Waterway Industries assigned $1593000 of accounts receivable to Carla Vista Co. as security for a loan of $1335000. Carla Vista charged a 3% commission on the amount of the loan; the interest rate on the note was 10%. During the first month, Waterway collected $399000 on assigned accounts after deducting $1510 of discounts. Waterway accepted returns worth $5000 and wrote off assigned accounts totaling $11900.

Entries during the first month would include

a debit to Cash of $400510.

debit to Bad Debt Expense of $11900.

debit to Allowance for Doubtful Accounts of $11900.

debit to Accounts Receivable of $417410.