The trial balance before adjustment for Sinatra Company shows the following balances. InstructionsUsing the data above, give
Question:
The trial balance before adjustment for Sinatra Company shows the following balances.
InstructionsUsing the data above, give the journal entries required to record each of the following cases. (Each situation is independent.)1. To obtain additional cash, Sinatra factors without recourse $20,000 of accounts receivable with Stills Finance. The finance charge is 10% of the amount factored.2. To obtain a one-year loan of $55,000, Sinatra assigns $65,000 of specific receivable accounts to Ruddin Financial. The finance charge is 8% of the loan; the cash is received and the accounts turned over to Ruddin Financial.3. The company wants to maintain Allowance for Doubtful Accounts at 5% of gross accounts receivable. 4. The company wishes to increase the allowance account by 1?% of netsales.
Accounts ReceivableAccounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...
Step by Step Answer:
1 Cash 18000 Loss on Sale of Receivables 20000 X 10 2000 Accounts R...View the full answer
