Use the Following Information for Questions

question 25

Multiple Choice

Use the following information for questions
On February 1, 2007, Norton Company factored receivables with a carrying amount of $300,000 to Koch Company.Koch Company assesses a finance charge of 3% of the receivables and retains 5% of the receivables.Relative to this transaction, you are to determine the amount of loss on sale to be reported in the income statement of Norton Company for February.
-Assume that Norton factors the receivables on a with recourse basis.The recourse obligation has a fair value of $1,500.The loss to be reported is

• A)$9,000.
• B)$10,500.
• C)$15,000.
• D)$25,500.

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