Journal entry of mays finance corporation

Assignment Help Accounting Basics
Reference no: EM13146607

SEK Corp. factors $400,000 of accounts receivable with Mays Finance Corporation on a without recourse basis on July 1, 2010. The receivables records are transferred to Mays Finance, which will receive the collections. Mays Finance assesses a finance charge of 1½% of the amount of accounts receivable and retains an amount equal to 4% of accounts receivable to cover sales discounts, returns, and allowances. The transaction is to be recorded as a sale. (List multiple debit/credit entries from largest to smallest amount, e.g. 10, 5, 2.)

(a) Prepare the journal entry on July 1, 2010, for SEK Corp. to record the sale of receivables without recourse.

(b) Prepare the journal entry on July 1, 2010, for Mays Finance Corporation to record the purchase of receivables without recourse.

Reference no: EM13146607

Questions Cloud

Reason for establishing internal audit function : Which of the following is generally considered to be a major reason for establishing an internal audit function?
A potato farmer bob agrees to sell 10,000 bags of potatoes : A potato farmer Bob agrees to sell 10,000 bags of potatoes and deliver them to "Save-a-Lot Supermarkets in yellow bags with green labels. When the potatoes arrive they have red labels, which the store considers will reduce the attractiveness o..
How many grams of carbon dioxide will be produced : C2H4 + 3O2 = 2CO2 + 2H2O If you start with 54 grams of ethylene (C2H4) how many grams of carbon dioxide will be produced?
Simulate problem using the monte carlo process : Simulate this problem using the Monte Carlo process. Show the demand during lead time (DDLT) for 30 reorders and determine the expected demand during lead time.
Journal entry of mays finance corporation : Prepare the journal entry on July 1, 2010, for SEK Corp. to record the sale of receivables without recourse. Prepare the journal entry on July 1, 2010, for Mays Finance Corporation to record the purchase of receivables without recourse.
Compute the number of moles of ascobic acid : Calculate the number of moles of Ascobic acid in the 50.00 ml Sample. Titration Volumes of KIO3 Initial Buret reading/ml trial 1=12.54 trial 2=8.78 Final buret reading/ trial 1=38.74 trial 2=34.93 Volume of KIO used/ml trial 1=? trial 2=?
A taxi driver in manhattan is sitting in his car : A taxi driver in Manhattan is sitting in his car passing time until someone needs a ride. Unbeknownst to the taxi driver, a man in a nearby alley is robbing two people. After the robber has completed the crime, he runs around the corner and ju..
What is meant by the term path dependency : What is meant by the term, path dependency and discuss how path dependency has effected the development of two major Australian economic institutions.
Are humans plantigrade or digitigrade : What features of rats make them good experimental models to learn about factors that affect humans?

Reviews

Write a Review

Accounting Basics Questions & Answers

  Determine the values of stocks and bonds

Financial management is about to explain what managers can do to make their companies more valuable. Managers must understand how investors determine the values of stocks and bonds if they are to identify, evaluate and implement projects that meet..

  Earnings per share of johnson alarm systems

Johnson alarm systems had $800,000 of retained earnings on December 31, 2004. The company paid dividends of $60,000 in 2004 and had retained earnings of $640,000 on December 31, 2003.

  Discuss the u.s. tax consequences

Discuss the U.S. tax consequences of each of the above items of income. Also, indicate how your answers would change if Harry held a green card.

  Computing bad debt expense

The balance in Accounts Receivable was $200,000 at 1/1 and $240,000 at 12/31. At 12/31/10, Smithson estimates that 5% of accounts receivable will prove to be uncollectible. What is Bad Debt Expense for 2010?

  What is the investments net present value

Robert Huft retires in 6 years. He would have to purchase equipment costing $590,000 to equip the outlet. Other outlets in the fast food chain have an annual net cash inflow of about $140,000. Mr. Anders would close the outlet in 6 years. He estim..

  Basics of annual cost savings

She does remember that the machine has a projected life of 10 years. Based on these data, the annual cost savings are:

  Determine the specific accounting principles

Explain the areas in which the Adelphia communications engaged in fraudulent financial reporting and the circumstances that led to this

  Calculate the amount charged to cost of goods sold

Using the FIFO assumption, calculate the amount charged to cost of goods sold for March. (Show computations), Using the LIFO assumption, calculate the value of ending inventory for March

  Social structure and income levels

Identify the social structure and income levels of the social classes in the United States. In your own words describe why a compensation specialist needs to understand this structure.

  Prepare an abbreviated income statement

Walker Company had total revenue and expense numbers of $1,500,000 and $1,200,000, respectively, in the current year. In addition, the company had a gain of $230,000 that resulted from the passage of new legislation, which is considered unusual an..

  Cash flow statement and computing net cash flow

Net cash flow provided (used) by operating activities. Net cash flow provided (used) by investing activities. Net cash flow provided (used) by financing activities.

  Adjusting entries by using good form

Prepare the adjusting entries using good form for each of the following situations as of January 31 (measurement date) for the one month of January

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd