Refer to RE6-8. On December 31, Jordan Inc. received $50,000 on assigned accounts. Prepare Jordan’s journal entries to record the cash receipt and the payment to McLaughlin.
On December 1 of the current year, Jordan Inc. assigns $125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a $750 service fee, advances 85% of Jordan’s accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.