How kanopy should account for the transaction

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Problem 1: Samona Plc agreed to buy a portfolio of €10 million trade receivables from Kanopy Plc. The receivables have 60-day terms. Samona agreed to pay an initial amount of €6 million in cash for the rights to the cash flows from the receivables. Once the receivables have been repaid, Samona will pay a balance of €4 million less any defaults and less the interest on the initial payment of €6 million. Explain how Kanopy should account for this transaction.

Reference no: EM132979437

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