A company can record the transfer of accounts receivable as a sale if all of the following are true except

Question

Quizplus · Accepted Answer

For a transfer of accounts receivable to be recorded as a sale, the transferor should not retain control over the transferred assets, which includes the ability to repurchase the transferred assets before their maturity. This condition implies that the transferor still has control over the assets, which contradicts the criteria for recognizing the transfer as a sale.

A Company Can Record the Transfer of Accounts Receivable as a Sale