Starlight Ltd

Starlight Ltd. assigned $600,000 of Accounts Receivable to Moonbeam Management as security for a loan of $580,000. Moonbeam charged a 3% commission on the amount of the loan; the interest rate on the loan was 10%. During the first month, Starlight collected $320,000 of the assigned accounts, after deducting $500 of discounts. As well, Starlight accepted returns worth $2,600 and wrote off assigned accounts totalling $4,500. Entries made by Starlight during the first month would include a

A) debit to Cash of $322,600.
B) debit to Bad Debts Expense of $4,500.
C) debit to Allowance for Doubtful Accounts of $4,500.
D) debit to Accounts Receivable of $324,500.