2 Logitech Corporation transferred $100,000 of accounts receivable to a local bank. The transfer was made without recourse. The localbank remits 85% of the factored amount to Logitech and retains the remaining 15%. When the bank collects the receivables, it willremit to Logitech the retained amount less a fee equal to 3% of the total amount factored. Logitech estimates a fair value of its 15%interest in the receivables of $11,000 (not including the 3% fee).What is the effect of this transaction on the company's assets, liabilities, and income before income taxes?AssetsLiabilitiesIncome before income taxesdecreased bywould not changedecreased by

Answered: Image /qna-images/answer/bb5167e7-f499-41c6-bc51-d4e6fc5017b8.jpg

Answered: Logitech Corporation transferred…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Mountain High Ice Cream Company transferred $60,000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10% to cover sales returns and allowances. When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5,000). Mountain High anticipates a $3,000 recourse obligation. The bank charges a 2% fee (2% of $60,000), and requires that amount to be paid at the start of the factoring arrangement.Required:Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Mountain High Ice Cream Company transferred $64.000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10% to cover sales returns and allowances. When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5.400). Mountain High anticipates a $3.400 recourse obligation. The bank charges a 2% fee (2% of $64.000), and requires that amount to be paid at the start of the factoring arrangement. Required: Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Mountain High Ice Cream Company transferred $79,000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10% to cover sales returns and allowances. When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $6,900). Mountain High anticipates a $4,900 recourse obligation. The bank charges a 3% fee (3% of $79,000), and requires that amount to be paid at the start of the factoring arrangement. Required: Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet 1 Record the transfer of accounts receivable. Note: Enter debits before credits. Event 1 General Journal Debit Credit >
Mountain High Ice Cream Company reports under IFRS. Mountain High transferred $70,000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 80% of the factored amount to Mountain High and retains 20% to cover sales returns and allowances. When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $6,000). Mountain High anticipates a $4,000 recourse obligation. The bank charges a 1% fee (1% of $70,000), and requires that amount to be paid at the start of the factoring arrangement. Mountain High has transferred control over the receivables, but determines that it still retains substantially all risks and rewards associated with them. Required: Prepare the journal entry to record the transfer on the books of Mountain High, considering whether the sale criteria under IFRS have been met. Note: If no entry is required for a transaction/event, select "No journal entry…
Serena Inc. transferred $76,000 of accounts receivable to the Deni Bank. The transfer was made with recourse. Deni remits 89% of the factored amount to Serena and retains 11% to cover sales returns and allowances. When the bank collects the receivables, it will remit to Serena the retained amount (which Serena estimates has a fair value of $6,000). Serena anticipates a $4,000 recourse obligation. The bank charges a 2.5% fee (2.5% of $76,000), and requires that amount to be paid at the start of the factoring arrangement. Instructions: Prepare the journal entry to record the transfer on the books of Serena Inc. assuming that the sale criteria are met.
Mountain High Ice Cream Company transferred $60,000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10%to cover sales returns and allowances. When the bank collects the receivables, it will remit to Mountain Highthe retained amount (which Mountain estimates has a fair value of $5,000). Mountain High anticipates a $3,000recourse obligation. The bank charges a 2% fee (2% of $60,000), and requires that amount to be paid at the startof the factoring arrangement.Required:Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met.
Mountain High Ice Cream Company transferred $64,000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10% to cover sales returns and allowances. When the bank collects the receivables, It will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5,400). Mountain High anticipates a $3,400 recourse obligation. The bank charges a 2% fee (2% of $64,000), and requires that amount to be paid at the start of the factoring arrangement. Required: Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met. Note: If no entry is required for a transaction/event, select "No Journal entry required" In the first account field. No 1 Event 1 Answer is not complete. General Journal Cash Loss on sale of receivables Receivable from factor Accounts receivable > Debit 56,320 Credit 64,000
es Mountain High Ice Cream Company reports under IFRS. Mountain High transferred $64,000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 80% of the factored amount to Mountain High and retains 20% to cover sales returns and allowances. When the bank collects the receivables, It will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5,400). Mountain High anticipates a $3,400 recourse obligation. The bank charges a 1% fee (1% of $64,000), and requires that amount to be paid at the start of the factoring arrangement. Mountain High has transferred control over the receivables, but determines that it still retains substantially all risks and rewards associated with them. Required: Prepare the Journal entry to record the transfer on the books of Mountain High, considering whether the sale criteria under IFRS have been met Note: If no entry is required for a transaction/event, select "No Journal…
Mountain High Ice Cream Company transferred $68,000 of accounts receivable to the Prudential Bank. The transfer was made without recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10%. When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5,800) less a 2% fee (2% of the total factored amount). Required: Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list View journal entry worksheet i No 1 Event 1 General Journal Cash Loss on sale of receivables Receivable from factor Accounts receivable Debit 61,200 Credit 68,000 ******** X .….…….
Mountain High Ice Cream Company transferred $60,000 of accounts receivable to the Prudential Bank. The transfer was made without recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10%. When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5,000) less a 2% fee (2% of the total factored amount).Required:Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Mountain High Ice Cream Company transferred $60,000 of accounts receivable to the Prudential Bank. The transfer was made without recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10%.When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountainestimates has a fair value of $5,000) less a 2% fee (2% of the total factored amount).Required:Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria aremet.
Japee, Inc. assigned P240,000 of its receivables to PJTC Finance company. A note payable was executed. The contract provided that PJTC would advance 85% of the gross amount of the receivables. The contract specified recourse and non-notification; therefore, Japee’s debtors continue to remit directly to it; the cash from customers is then remitted to the finance company. The cash remitted is first applied to the finance charges, with the remainder applied to the principal. During the first month, customers owing P164,000 paid cash, less sales returns and allowances of P6,400. The finance charge at the end of the first month was P1,400.How much is the disclosed equity in assigned accounts as of the end of the first month?

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