Prepare grouper journal entry to record the sale

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Reference no: EM132696401

Monty Financial Services has agreed to purchase $480,000 of Grouper Corporation's outstanding accounts receivable, with recourse. Grouper's controller estimates that the fair value of the uncollectible accounts is $76,800. Monty will charge Grouper 10% of the total receivables balance as a financing fee, and will withhold an initial amount of 20%.

Problem 1: Calculate the net proceeds and the gain or loss on the disposal of receivables to Monty.

Problem 2: Prepare Grouper's journal entry to record the sale.

Reference no: EM132696401

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