The following information relates to Zulu Companys accounts receivable for 2014: Accounts receivable, 1/1/2014 ....... $ 750,000

Question:

The following information relates to Zulu Company’s for 2014:
Accounts receivable, 1/1/2014 ....... $ 750,000
Credit sales for 2014 ............ 3,100,000
Accounts written off during 2014 ........ 45,000
Collections from customers during 2014 .... 2,400,000
Estimated uncollectible accounts at 12/31/2014 . 95,000

A factor has recently offered to purchase all of Zulu’s outstanding receivables without recourse for 94% of their face amount.

Required:
At what net amount should Zulu report its receivables assuming the company chooses to measure financial assets at fair value?

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...