A Company Sells $800,000 of Accounts Receivable to a Factor

question 182

Multiple Choice

A company sells $800,000 of accounts receivable to a factor for cash, incurring a 2% service charge.The entry to record the sale should not include a

• A)debit to Interest Expense for $16,000.
• B)debit to Cash for $784,000.
• C)debit to Service Charge Expense for $16,000.
• D)credit to Accounts Receivable for $800,000.

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Definitions:

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First Consul

A title given to Napoleon Bonaparte in 1799, marking his significant political and military leadership in France.

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