Solution-Prepare the journal entry to record the agreement

Prepare the journal entry to record the agreement

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Reference no: EM132539062

Question - DRB, Inc. enters into an arrangement with Genius Enterprises whereby Genius will purchase $200,000 of DRB's receivables and charge a 6% fee. As part of the agreement, Genius will retain $20,000 as additional security. DRB sold the receivable with recourse obligation, estimated to be $3,000. The 6% fee will be paid at the start of the factoring arrangement. Prepare the journal entry to record the agreement assuming that the sale criteria are met.

Reference no: EM132539062

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Prepare the journal entry to record the agreement

Reference no: EM132539062

Reference no: EM132539062

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