Miles to Go Is a Travel Agency Specializing in Tours

Miles to Go is a travel agency specializing in tours to Africa and Australia.Miles to Go has $1,200,000 in accounts receivable and factors these receivables with Fox Factors.The agreement with Fox calls for a service charge of 2% of the amount of receivables sold.The net effects on the statement of financial position for Miles to Go of factoring its receivables is a(n)

A) Increase in assets of $24,000.
B) Increase in assets of $1,176,000.
C) Increase in equity of $1,176,000.
D) Decrease in equity of $24,000.