McGraw Motors Both Sells and Leases Vehicles

question 117

Essay

McGraw Motors both sells and leases vehicles. With sales temporarily slowing due to the economy, the company factored a significant portion of its lease receivables. The company factored with recourse receivables with a carrying amount of $22 million in exchange for $21.45 million less a holdback of $550,000 for potential uncollectible accounts. Due to poor economic conditions, the actual uncollectible accounts amounted to $900,000.
Record the entries on McGraw's books relating to the $22 million factoring of lease receivables.

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Definitions:

Abducts

Refers to the movement of a body part away from the central axis or midline of the body.

Triangle

A polygon with three edges and three vertices, the simplest form of polygon in geometry.

Pectoralis Major

A significant muscle located in the upper part of the chest, aiding in arm and shoulder motion.

Upper Chest

Refers to the region of the body encompassing the upper part of the thorax, including the pectoral muscles, clavicles, and upper ribs.