A Company Factored $45,000 of Its Accounts Receivable and Was

question 3

Multiple Choice

A company factored $45,000 of its accounts receivable and was charged a 4% factoring fee. The journal entry to record this transaction would include a:

• A)Debit to Cash of $45,000, a debit to Factoring Fee Expense of $1,800, and credit to Accounts Receivable of $46,800.
• B)Debit to Cash of $45,000 and a credit to Accounts Receivable of $45,000.
• C)Debit to Cash of $43,200, a debit to Factoring Fee Expense of $1,800, and a credit to Accounts Receivable of $45,000.
• D)Debit to Cash of $46,800 and a credit to Accounts Receivable of $46,800.
• E)Debit to Cash of $45,000 and a credit to Notes Payable of $45,000.

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Definitions:

Average Adult

A reference to the common or typical characteristics, such as age, size, or health, of an adult person in a certain population.

Agglutination

The clumping together of particles, often used to refer to the clumping of cells or particles in response to antibodies or antigens.

Hemolysis

The destruction or rupture of red blood cells, leading to the release of hemoglobin into the blood plasma, which can occur due to various conditions or factors.

Hemostasis

The process whereby bleeding is stopped within the body, involving blood clotting and vasoconstriction.