On October 1, 2023, Alpha Inc. assigns $3 million of its accounts receivable to Alberta Provincial Bank
Question:
On October 1, 2023, Alpha Inc. assigns $3 million of its accounts receivable to Alberta Provincial Bank as collateral for a $2.6-million loan evidenced by a note. The bank’s charges are as follows: a finance charge of 4% of the assigned receivables and an interest charge of 10% on the loan. Prepare the October 1 journal entries for both Alpha Inc. and Alberta Provincial Bank.
Step by Step Answer:
Alpha Inc Cash Finance Expense 3000000 X 4 Notes P...View the full answer
Intermediate Accounting Volume 1
ISBN: 9781119740469
13th Canadian Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy
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A journal entry is an act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company\'s debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit
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