Reference no: EM133021791

Questions -

Q1. Hanzo Company factored P4,000,000 of accounts receivable to a finance entity at the beginning of the current year. Control was surrendered by Hanzo Company. The factor assessed a fee of 5% and retained a holdback equal to 10% of the accounts receivable. In addition, the factor charged 15* interest computed on a weighted average time to maturity of the accounts receivable of 30 days (use 360 days)

What amount was initially received by Hanzo Company from factoring?

Assuming all accounts receivable are collected, what is the cost factoring?

Q2. Leslie company factored with recourse P2,000,000 of accounts receivable with a bank. The finance charge is 3% and 5% was retained to cover sales discounts, sales returns and sales allowances. What amount of cash was received on the sale of accounts receivable?

Q3. Terizla Company accepted from a customer a P2,000,000, 90-day, 12% note dated August 31, 2020. On September 30, 2020, the entity discounted without recourse the note at 15%. However, the proceeds were not received until October 1, 2020.

In the income statement for the year ended September 31, 2020, what amount should be reported as loss on note receivable discounting?

In the income statement for the years ended September 31, 2020, what amount should be reported as proceeds from the discounted note?