XYZ Company factored P6,000,000 of accounts receivable to ABC Company on October 1, 2006. Control was...

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XYZ Company factored P6,000,000 of accounts receivable to ABC Company on October 1, 2006. Control was surrendered by XYZ. ABC accepted the receivables subject to recourse for nonpayment. ABC assessed a fee of 3% and retains a holdback equal to 5% of the accounts receivable. In addition, ABC charged 15% interest o computed on a weighted-average time to maturity of the receivables of 54 days. The fair value of the recourse obligation is P90,000. 4. XYZ will recelve and record cash of a. 5,296,850 b. 5,386,850 c. 5,476,850 d. 5,556,850 5. Assuming al receivables are collected, XYZ Company's cost of factoring the recelvables would a. 313,150 b. 180,000 C. 433,150 a. 613,150 XYZ Company factored P6,000,000 of accounts receivable to ABC Company on October 1, 2006. Control was surrendered by XYZ. ABC accepted the receivables subject to recourse for nonpayment. ABC assessed a fee of 3% and retains a holdback equal to 5% of the accounts receivable. In addition, ABC charged 15% interest o computed on a weighted-average time to maturity of the receivables of 54 days. The fair value of the recourse obligation is P90,000. 4. XYZ will recelve and record cash of a. 5,296,850 b. 5,386,850 c. 5,476,850 d. 5,556,850 5. Assuming al receivables are collected, XYZ Company's cost of factoring the recelvables would a. 313,150 b. 180,000 C. 433,150 a. 613,150

Answer rating: 100% (QA)

Part 1 Total Debtors P6000000 Time 54 Days Interest 15 Fee 3 HoldBack 5 Recourse Obligation P900... View the full answer