On December 1, the Harrison Company sold without recourse $345,000 of its accounts receivable to Happy Finance Company for 85% of their value. A 10% commission on the gross value of the factored accounts was charged.
Required:
a. Prepare the journal entry to record the factoring.
b. Briefly discuss how the factored accounts are disclosed in the financial statements.

Question

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The Answer of On December 1, the Harrison Company sold without recourse $345,000 of its accounts receivable to Happy Finance Company for 85% of their value. A 10% commission on the gross value of the factored accounts was charged.
Required:
a. Prepare the journal entry to record the factoring.
b. Briefly discuss how the factored accounts are disclosed in the financial statements.

On December 1, the Harrison Company Sold Without Recourse $345,000