Question: On March 1 , 2 0 1 4 , Beijing Pasta Company assigns $ 1 , 4 0 0 , 0 0 0 of its

On March 1,2014, Beijing Pasta Company assigns $1,400,000 of its accounts receivable to Bank of China as collateral for a $1,000,000 note. Bank of China assesses a finance charge of 1 percent of the accounts receivable and interest on the note of 12 percent. Which of the following is correct regarding this transaction?

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