Wraith Inc. factored without recourse its accounts receivable amounting to P100,000. Wraith received P82,000 as cash advance from the bank and the bank withheld 3,000 as contingency for uncollectible accounts. The bank charged Wraith P15,000 as finance service fee for factoring. How much is the loss on factoring from the transaction?
Q: On December 1, 2017, Kreme Company assigned on a nonnotification basis accounts receivable of…
A: A loan taken by a company by assigning its accounts receivables to the bank. This means that the…
Q: Otter Company has a receivable amounting to P1,200,000; Otter had previously established an…
A: Net realizable value of receivables = Beginning receivable - Beginning Allowance for bad debts =…
Q: Haru Company sold accounts receivable without recourse for P10, 600,000. Mild company received P10,…
A: Factoring of Accounts Receivable : Accounts receivable are the money owe by the debtors…
Q: Mazda Company sold P5,800,000 in accounts receivable for cash of P5,000,000. The factor withheld 10%…
A: Loss due to factor = Accounts receivable balance - sale value of receivable = 5800000 - 5000000 =…
Q: ABC Company factored ₱3,500,000 of accounts receivable with a finance company. The factoring fee was…
A: Amount withheld = Accounts receivables x 10% = ₱3,500,000 x 10% = ₱350,000
Q: Sakuragi Corporation engaged in the following transactions with regards to financing of receivable…
A:
Q: The F Company uses the allowance method is used to account for uncollectible receivables. It had the…
A: Receivables, loans, and other obligations that are likely to be paid are referred to as…
Q: Adobo Company assigned P 4,000,000 of accounts receivables as collateral for a P1,500,000 5% loan…
A: Loss on the transfer of accounts receivables =accounts receivables assigned x finance charge %
Q: Alpha Gym allows services to be on account to loyal customers. The unadjusted Accounts Receivable at…
A: Formula: Bad debts amount = Sales amount x percentage of bad debts amount Sales amount to be…
Q: On December 1, 2020, RB Company assigned on a non-notification basis accounts receivable of…
A: Accounts receivables refers to the amount or money owed to a company by its debtors.
Q: On July 31, 2021, JUNGKOOK Company borrowed from a bank via issuing a 13.2% note. Transaction costs…
A: Meaning of the note is that it is a legal document that acts as an IOU from the borrower to the…
Q: Otter Company has a receivable amounting to P1,200,000; Otter had previously established an…
A: Net realizable value of receivables = Beginning receivable - Beginning Allowance for bad debts =…
Q: ABC Corporation uses the cash basis of accounting. Damalerio collected P1,400,000 from its customers…
A: Sales Revenue under the accrual basis of accounting = Collection from customers during the year +…
Q: On April 4, 2021, LASTNATOBEYBE, Inc. sold goods on account to a customer for P1,000,000, terms were…
A: Factoring means where the account receivables has been sold to outside agency against commission and…
Q: HIPIEE COMPANY sold P5,800,000 accounts receivable for cash of P5,000,000. The factor withheld 10%…
A: The loss on factoring is calculated as difference between sale price and carrying value of accounts…
Q: Samson Wholesale Beverage Company regularly factors its accounts receivable with the Milpitas…
A: Compute the cash received.
Q: On December 1, 2020, RB Company assigned on a non-notification basis accounts receivable of…
A: Accounts Receivable :- Account Receivable are the balances of customers that have not paid their…
Q: On July 31, 2021, Sampaguita Company borrowed from a bank via issuing a 13.5% note. Transaction…
A: The interest expense is the charge against the profit or net income of the business. It is shown in…
Q: How much is the interest expense for 2020?
A: Interest expenses are those expenses which the company has to pay on amount which is outstanding and…
Q: Damalerio Corporation uses the cash basis of accounting. Damalerio collected P1,400,000 from its…
A: Sales Revenue under the accrual basis of accounting = Accounts receivable at the end of the year +…
Q: Company B uses $800,000 of its accounts receivables as collateral when the company borrowed…
A: The accounts receivable refers to the amounts due from customers for the goods and services provided…
Q: Serena Inc. transferred $76,000 of accounts receivable to the Deni Bank. The transfer was made with…
A: Accounts receivables refer to the amount due to the entity by its customers. In other words, it can…
Q: Shown below are selected accounts and their balances for the KTS Company as of December 31, 2021:…
A: Current assets: Current assets are all those assets that are expected to be sold or used as a result…
Q: On February 1, 2004, Mickey Mouse Corporation factored receivables amounting to P500,000 to Minnie…
A: Allowance for uncollectible accounts = Total accounts receivables x 3% = P500,000 x 3% = P15,000
Q: VKS Co. assigned P 4,000,000 of accounts receivables as collateral for a P1,500,000 5% loan with a…
A: Loss on the transfer of accounts receivables = Amount received from the bank x finance charge %
Q: The Premiere Company obtained a short-term bank loan for P1,000,000 at an annual interest rate 12%.…
A: "Since you have posted a multi-part question therefore as per the guidelines we will be solving the…
Q: ABE Company factored P100,000 of its accounts receivable to Cee Company for P85,000. An allowance…
A: Cash received = Purchase price- Amount retained by factor Amount retained by factor = Purchase price…
Q: Due to cash flow issues, Angler Fish Company factors $540.000 of its accounts receivable to Gause…
A: SOLUTION- In a factoring with recourse transaction, the seller guarantees the collection of accounts…
Q: Mountain High Ice Cream Company transferred $60,000 of accounts receivable to the Prudential Bank.…
A: Total cash received = Accounts receivable X % remit = $60,000 x 90% = $54,000 Receivable from factor…
Q: At the beginning of the current year, Malice Company reported allowance for doubtful accounts of…
A: The allowance for doubtful accounts is created to record estimated bad debt expense for the period.
Q: .Ping Company finances some of its current operations by factoring its accounts receivable to a…
A: The question is based on the concept of Financial Accounting.
Q: EXO Company accepted a P400,000 face value, six-month, 9% note dated May 15 from a customer. After…
A: Interest accrued = face value of note x rate of interest x no. of months/12 = P400,000 x 9% x 2/12…
Q: Wanda Company sold accounts receivable without recourse for P8,200,000. The company received…
A: Formula: Loss on factoring = Net Realizable value of Accounts receivable - Sale value of receivable…
Q: Shown below are selected accounts and their balances for the Zay Company as of December 31, 2021…
A: Current liabilities are short term obligations which are due within 1 year or an operating cycle…
Q: Maxwell Corporation factored, with recourse, $200,000 of accounts receivable with Huskie Financing.…
A: Loss on sale of receivable includes the finance charge and the recourse obligation and does not…
Q: On April 1, 2018, Audrey Company assigned accounts receivable totaling P400,000 as collateral on a…
A: Journal Entries
Q: Carnival Co found itself in financial difficulties and decided to use its accounts receivable as a…
A: It is clearly mentioned in the question that the cash received from factoring is P695000 and loss…
Q: On July 31, 2021, Sampaguita Company borrowed from a bank via issuing a 13.5% note. Transaction…
A: The interest expense is the charge against the profit or net income of the business. It is shown in…
Q: National Bank collected $3,000 including $300 interest on behalf of Z Inc. from one of its debtors…
A: Solution: Bank reconcilaition is the statement through which cash balance in the books is matched…
Q: Damalerio Corporation uses the cash basis of accounting. Damalerio collected P1,400,000 from its…
A: Prepare a T-account of accounts receivable and post the beginning balance, ending balance and cash…
Q: Alpha Gym allows services to be on account to loyal customers. The unadjusted Accounts Receivable at…
A: The following computations are done in the records of Alpha Gym NRV of accounts Receivables.
Q: Mountain High Ice Cream Company transferred $60,000 of accounts receivable to the Prudential Bank.…
A: Journal entry is a primary entry that records the financial transactions initially.
Q: On July 31, 2021, ABC Company borrowed from a bank via issuing a 13.2% note. Transaction costs of…
A: No expense in 2020 because no point related to the 2020 year. Where as in 2021 the interest expense…
Q: Use the following information for A-C On February 1, 2021, Blue Hour Company factored receivables…
A: Accounts receivable represents the amount earned by the company but the amount has not been…
Q: Otter company has a receivable amounting to P1,200,000 otter had previously established an allowance…
A: Solution : Given Face value of receivable =1,200,000 Allowance for bad debts…
Q: In December 2020, Joe's Company, engaged into a factoring armangement with Gaba's Bank (factor),…
A: The journal entries are the first step in the accounting process because a transaction is recorded…
Q: Sakuragi Corporation engaged in the following transactions with regards to financing of receivable…
A: Accounts Receivables :- It is the amount due from our customers from…
Q: Wraith Inc. factored without recourse its accounts receivable amounting to P100,000. Wraith received…
A: Accounting treatment in case of account receivable factored without recourse. The cash received on…
Q: ABE Company factored P100,000 of its accounts receivable to Cee Company for P85,000. An allowance…
A: a. 80,750 b. 16,250 Explanation:
How much is the loss on factoring from the transaction? *
Zero
10,000
15,000
20,000
Step by step
Solved in 2 steps
- Marmol Corporation uses the allowance method for bad debts. During 2019, Marmol charged 50,000 to bad debt expense and wrote off 45,200 of uncollectible accounts receivable. These transactions resulted in a decrease in working capital of: a. 0 b. 4,800 c. 45,200 d. 50,000A customer was unable to pay the accounts receivable on time in the amount of $34,000. The customer was able to negotiate with the company and transferred the accounts receivable into a note that includes interest, along with an up-front cash payment of $6,000. The note maturity date is 24 months with a 15% annual interest rate. What is the entry to recognize this transfer?Aron Larson is a customer of Bank Enterprises. Mr. Larson took out a loan in the amount of $120,000 on August 1. On December 31, Bank Enterprises determines the loan to be uncollectible. Larson had not paid anything toward the balance due on account. What is the journal entry recording the bad debt write-off?
- On June 1, Phillips Corporation sold, with recourse, a note receivable from a customer to a bank. The note has a face value of 15,000 and a maturity value (principal plus interest) of 15,400. The discount is calculated to be 385, and the accrued interest income is 100. The recourse liability is estimated to be 1,000. Prepare the journal entry of Phillips to record the sale of the note receivable.Bristax Corporation recorded $1,385,660 in credit sales for the year, and $732,410 in accounts receivable. The uncollectible percentage is 3.1% for the income statement method and 4.5% for the balance sheet method. A. Record the year-end adjusting entry for 2018 bad debt using the income statement method. B. Record the year-end adjusting entry for 2018 bad debt using the balance sheet method. C. Assume there was a previous debit balance in Allowance for Doubtful Accounts of $20,550; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method. D. Assume there was a previous credit balance in Allowance for Doubtful Accounts of $17,430; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method.Wraith Inc. factored without recourse its accounts receivable amounting to P100,000. Wraith received P82,000 as cash advance from the bank and the bank withheld 3,000 as contingency for uncollectible accounts. The bank charged Wraith P15,000 as finance service fee for factoring. How much is the loss on factoring from the transaction? a. Zero b. 10,000 c. 15,000 d. 20,000
- Damalerio Corporation uses the cash basis of accounting. Damalerio collected P1,400,000 from its customers during the year. Damalaerio had P100,000 in Accounts receivable at the beginning of the year, and P180,000 in Accounts receivable at the end of the year. The company also had P40,000 and P50,000 of allowance for bad debts at the beginning and at the end of the year, respectively. What is Damalerio’s Sales Revenue under the accrual basis of accounting? Group of answer choices 1,400,000 1,480,000 1,320,000 1,580,000Mazda Company sold P5,800,000 in accounts receivable for cash of P5,000,000. The factor withheld 10% of the cash proceeds to allow for possible customer returns and other adjustments. An allowance for bad debts of P600,000 had previously been established by Mazda in relation to these accounts. What was the loss on factoring recognized by Mazda Company?Company B uses $800,000 of its accounts receivables as collateral when the company borrowed $5,000,000 4% loan from a bank. To obtain the loan, Company B pays a finance fee of 3% on the transaction upfront. What would be recorded as a gain (loss) on the transfer of receivables? A. $0 B. Loss of $200,000 C. Loss of $150,000 D. Loss of $800,000
- Tagum Inc. required additional cash for its operation and used accounts receivable to raise such needed cash, as follows: On December 1, 2021 Tagum Inc. assigned on a non-notification basis accounts receivable of P 5,000,000 to a bank in consideration for a loan of 90% of the receivables less 5% service fee on the accounts assigned. Tagum Inc. signed a note for the bank loan. On December 31, 2021, Tagum Inc. collected assigned accounts of P3,000,000 less discount of P 200,000. Tagum Inc. remitted the collections to the bank in partial payment for the loan. The bank applied first the collection to the interest and the balance to the principal. The agreed interest is 1% per month on the loan balance. Tagum Inc. sold P 1,550,000 of accounts receivable for P 1,340,000 . The receivables had a carrying amount of P 1,470,000 and were sold outright on a nonrecourse basis. Tagum Inc. received an advance of P 300,000 from Union Bank by pledging P 360,000 of accounts receivable On June 30, 2021,…Otter company has a receivable amounting to P1,200,000 otter had previously established an allowance for bad debts of 50,000 in connection with these receivables.otter company sold these receivables with recourse for P1,060,000. Otter received P1,000,000 cash immediately from the factor. the remaining P60,000 will be received once the factor verifies that none of the receivables is in dispute. control was surrendered by Otter. the fair value of the recourse obligation is P26,000The loss on factoring to be recognized by Otter Company is?Tagum Inc. required additional cash for its operation and used accounts receivable to raise such needed cash, as follows: On December 1, 2021 Tagum Inc. assigned on a non-notification basis accounts receivable of P 5,000,000 to a bank in consideration for a loan of 90% of the receivables less 5% service fee on the accounts assigned. Tagum Inc. signed a note for the bank loan. On December 31, 2021, Tagum Inc. collected assigned accounts of P 3,000,000 less discount of P 200,000. Tagum Inc. remitted the collections to the bank in partial payment for the loan. The bank applied first the collection to the interest and the balance to the principal. The agreed interest is 1% per month on the loan balance. Tagum Inc. sold P 1,550,000 of accounts receivable for P 1,340,000 . The receivables had a carrying amount of P 1,470,000 and were sold outright on a nonrecourse basis. Tagum Inc. received an advance of P 300,000 from Union Bank by pledging P 360,000 of accounts receivable On June 30,…