On 1 September 2021, ABC Bhd used its receivables totalling RM 350,000 as collateral on a 250,000, 15% note from CIMB Bank. ABC Bhd will continue to collect the assigned receivables. CIMB Bank will charge 2% as a finance charge which will be deducted in advance on the 250,000 value of the note. Collections of receivables for September is RM100,000, less cash discounts of RM800. On 1 October, ABC Bhd paid to the bank the amount owed for September collection plus accrued interest. During October, ABC Bhd collected the remaining accounts except for RM550 written off as uncollectible. On 1 November, ABC Bhd paid to CIMB Bank the remaining account owed plus accrued interest. REQUIRED: Prepare the journal entries necessary for both ABC Bhd and CIMB Bank.
On 1 September 2021, ABC Bhd used its receivables totalling RM 350,000 as collateral on a 250,000, 15% note from CIMB Bank. ABC Bhd will continue to collect the assigned receivables. CIMB Bank will charge 2% as a finance charge which will be deducted in advance on the 250,000 value of the note. Collections of receivables for September is RM100,000, less cash discounts of RM800. On 1 October, ABC Bhd paid to the bank the amount owed for September collection plus accrued interest. During October, ABC Bhd collected the remaining accounts except for RM550 written off as uncollectible. On 1 November, ABC Bhd paid to CIMB Bank the remaining account owed plus accrued interest. REQUIRED: Prepare the journal entries necessary for both ABC Bhd and CIMB Bank.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 11RE: On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to...
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781337280570
Author:
Scott, Cathy J.
Publisher:
South-Western College Pub