Additional Problem 11 Swifty Financial Services has agreed to purchase $560,000 of Blue Spruce Corporation's outstanding...
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Additional Problem 11 Swifty Financial Services has agreed to purchase $560,000 of Blue Spruce Corporation's outstanding accounts receivable, with recourse. Blue Spruce's controller estimates that the fair value of the uncollectible accounts is $89,600. Swifty will charge Blue Spruce 10% of the total receivables balance as a financing fee, and will withhold an initial amount of 20%. Calculate the net proceeds and the gain or loss on the disposal of receivables to Swifty. Net proceeds on disposal of receivables $ Prepare Blue Spruce's journal entry to record the sale. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit Additional Problem 11 Swifty Financial Services has agreed to purchase $560,000 of Blue Spruce Corporation's outstanding accounts receivable, with recourse. Blue Spruce's controller estimates that the fair value of the uncollectible accounts is $89,600. Swifty will charge Blue Spruce 10% of the total receivables balance as a financing fee, and will withhold an initial amount of 20%. Calculate the net proceeds and the gain or loss on the disposal of receivables to Swifty. Net proceeds on disposal of receivables $ Prepare Blue Spruce's journal entry to record the sale. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit
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Related Book For
Corporate Finance A Focused Approach
ISBN: 978-1439078082
4th Edition
Authors: Michael C. Ehrhardt , Eugene F. Brigham
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