Journal entries necessary for faeber to record preceding

Assignment Help Financial Accounting

Reference no: EM131293767

Faeber Textile Company frequently factors its accounts receivable. During 2016, Faeber made credit sales of $100,000 to customers, under terms of 2/10, n/30. Faeber records its credit sales using gross price. In 2016, Faeber sold $70,000 of these receivables to a factor. The factor remitted 90% of the accounts receivable factored and charged a 12% commission on the gross amount of the factored receivables. The factoring agreement also requires Faeber to be responsible for any cash discounts taken by customers upon payment of the factored receivables. Faeber is charged for these cash discounts upon reimbursement by the factor. During 2016, the factor collected the remaining amount of the factored receivables, minus the 2% discount on 94% of the collected receivables, and returned the balance owed to Faeber. Faeber collected the remaining amount of the unfactored accounts receivable, minus the 2% discount on 96% of the collected receivables.

Required:

Prepare all the journal entries necessary for Faeber to record the preceding information.

Reference no: EM131293767

Questions Cloud

Creation of new disease-resistant tomato plant : West Coast Growers incurs the following costs during the year related to the creation of a new disease-resistant tomato plant. What amount should West Coast Growers report as research and development (R&D) expense in its income statement?

Write a research paper for the us and south korea economy : Write a Research Paper for the US and South Korea Economy. "I'm pleased with your work," he says. The board was impressed with your list of factors. Your ranking made sense because your explanations were well-written.

Improved inventory management : Technology has improved logistics processes and supply chain management in the last decade. Explain how information systems or Internet technology has improved inventory management, order processing, or supply chain integration in the aviation ind..

Developing new products and services : Companies increasingly find the need to innovate not only by developing new products and services but by creating or modifying business models. Critically discuss the challenge of operating an existing and a new business model simultaneously and g..

Journal entries necessary for faeber to record preceding : Faeber Textile Company frequently factors its accounts receivable. During 2016, Faeber made credit sales of $100,000 to customers, under terms of 2/10, n/30. Faeber records its credit sales using gross price. In 2016, Faeber sold $70,000 of these rec..

Overcome obstacles business or personal : To overcome obstacles business or personal, you must master the three obstacles above. What are your ideas?

Literature review on business strategy analysis : Literature review on Business strategy Analysis Advantages and Disadvantages of SWOT,PESTEL,Porter's Five forces and VALUE CHAIN

What are the key issues relating to the situation : What are the key issues relating to the situation and describe how they impact on Alisha's work responsibilities?What are the steps you will take to manage Alisha's complaint properly and describe how these comply with the company's policies and pr..

Prepare a spreadsheet using excel or a similar program : Prepare a spreadsheet using Excel or a similar program in which you compute the following for each proposed location Accounting rate of return on investment.

User Account

All Pages