Question

On April 1, 2017, BLANK Company assigns $504,100 of its accounts receivable to the BLANK Bank as collateral for a $314,000 loan due July 1, 2017. The assignment agreement calls for BLANK company to continue to collect the receivables. BLANK Bank assesses a finance charge of 4% of the accounts receivable, and interest on the loan is 10% (a realistic rate of interest for a note of this type).

Prepare the April 1, 2017, journal entry for BLANK Company. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Apr. 1, 2017 Prepare the journal entry for BLANK company’s collection of $366,500 of the accounts receivable during the period from April 1, 2017, through June 30, 2017. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit On July 1, 2017, BLANK company paid BLANK bank all that was due from the loan it secured on April 1, 2017. Prepare the journal entry to record this payment. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit July 1, 2017

Answer 1

Prepare the April 1, 2017, journal entry for BLANK Company. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
Apr. 1, 2017	Cash	$293836
	Finance Charge($504100*4%)	$20164
	Notes Payable		$314000

Prepare the journal entry for BLANK company’s collection of $366,500 of the accounts receivable during the period from April 1, 2017, through June 30, 2017. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
Cash	$366500
Account Receivable		$366500

On July 1, 2017, BLANK company paid BLANK bank all that was due from the loan it secured on April 1, 2017. Prepare the journal entry to record this payment. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
July 1, 2017	Notes Payable	$314000
	Interest Expense($314000*10%*3/12)	$7850
	Cash		$321850