Use the Following Information for Questions

question 4

Multiple Choice

Use the following information for questions
Henry Co.assigned $400,000 of accounts receivable to Easy Finance Co.as security for a loan of $335,000.Easy charged a 2% commission on the amount of the loan; the interest rate on the note was 10%.During the first month, Henry collected $110,000 on assigned accounts after deducting $380 of discounts.Henry accepted returns worth $1,350 and wrote off assigned accounts totaling $2,980.
-Entries during the first month would include a

• A)debit to Cash of $110,380.
• B)debit to Bad Debt Expense of $2,980.
• C)debit to Allowance for Doubtful Accounts of $2,980.
• D)debit to Accounts Receivable of $114,710.

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