Blue Enterprises sold $788,000 of accounts receivable to Crane Factors, Inc. on a without recourse basis under IFRS, as the risks and rewards have been transferred to Crane. The transaction meets the criteria for a sale, and no asset or liability components of the receivables are retained by Blue. Crane Factors assesses a finance charge of 4% of the amount of accounts receivable and retains an amount equal to 5% of accounts receivable. Prepare journal entries for both Blue and Crane. Use the account Due to Customer for Crane. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts. List all debit entries before credit entries.)

Blue Enterprises sold $788,000 of accounts receivable to Crane Factors, Inc. on a without recourse basis under IFRS, as the risks and rewards have been transferred to Crane. The transaction meets the criteria for a sale, and no asset or liability components of the receivables are retained by Blue. Crane Factors assesses a finance charge of 4% of the amount of accounts receivable and retains an amount equal to 5% of accounts receivable. Prepare journal entries for both Blue and Crane. Use the account Due to Customer for Crane. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts. List all debit entries before credit entries.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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