Vaughn Corp. factors $$440,000$ of accounts receivable with Bramble Finance Corporation on a without recourse basis on July $1,2025.$ The receivables records are transferred to Bramble Finance, which will receive the collections. Bramble Finance assesses a finance charge of $1\mathrm{.}90\%$ of the amount of accounts receivable and retains an amount equal to $6\%$ of accounts receivable to cover sales discounts, returns, and allowances. The transaction is to be recorded as a sale.

$($a$)$

Your answer is correct.

Prepare the journal entry on July $1,2025,$ for Vaughn Corp. to record the sale of receivables without recourse. $($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 omount is entered. Do not indent manually. List all debit entries before credit entries.$)$

Date Account Titles and Explanation

Debit

Credit

July $1,2025$

Cash

$405240$

Receivable from Factor

Loss on Sale of Receivables

Accounts Receivable

$440000$

eTextbook and Media

List of Accounts

Attempts: $2$ of $2$ used

$($b$)$

Prepare the journal entry on July $1,2025,$ for Bramble Finance Corporation to record the purchase of receivables without recourse. $($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. List all debit entries before credit entries.$)$ Part b