Question
XYZ Company factored P6,000,000 of accounts receivable to ABC Company on October 1. Control was surrendered by XYZ. ABC accepted the receivables subject to recourse
XYZ Company factored P6,000,000 of accounts receivable to ABC Company on October 1. Control was surrendered by XYZ. ABC accepted the receivables subject to recourse for nonpayment. ABC assessed a fee of 3% and retains a holdback equal to 5% of the accounts receivable. In addition, ABC charged 15% interest computed on a weighted-average time to maturity of the receivables of 54 days. The fair value of the recourse obligation is P90,000. XYZ will receive and record cash of (assume 365 days)
XYZ Company factored P6,000,000 of accounts receivable to ABC Company on October 1. Control was surrendered by XYZ. ABC accepted the receivables subject to recourse for nonpayment. ABC assessed a fee of 3% and retains a holdback equal to 5% of the accounts receivable. In addition, ABC charged 15% interest computed on a weighted-average time to maturity of the receivables of 54 days. The fair value of the recourse obligation is P90,000. XYZ will receive and record cash of (assume 365 days)
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Auditing Information Systems Enhancing Performance Of The Enterprise
Authors: Abraham Nyirongo
1st Edition
1490754997, 9781490754994
