Exercise 7-10. Please provide explanation.

Brief Exercise 7-10O Sandhill Incorporated factored $168,400 of accounts receivable with Teal Factors Inc. on a without-recourse basis. Teal assesses a 2% finance charge of the amount of accounts receivable and retains an amount equal to 6% of accounts receivable for possible adjustments. Prepare the journal entry for Sandhill Incorporated and Teal Factors to record the factoring of the accounts receivable to Teal. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit Sandhill Teal 2