Moon inc factors 3000000 of its accounts receivables, Financial Accounting

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Moon inc factors 3000000 of its accounts receivables

Moon Inc. factors $3,000,000 of its accounts receivables WITHOUT recourse for a finance charge of 4%. The finance company retains an amount equal to 8% of the accountsreceivable for possible adjustments. Moon estimates the fair value of the recourse liabilityat $300,000. What would be the debit to Cash in the journal entry to record thistransaction?

a. 3,000,000

B. 2,880,000

C. 2,640,000

D. 2,340,000

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Financial Accounting: Moon inc factors 3000000 of its accounts receivables

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Financial Accounting: Moon inc factors 3000000 of its accounts receivables

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