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:

Total Revenue

Total revenue is the full amount of money received by a company for its goods or services before any expenses are subtracted.

Average Revenue

Total revenue divided by the quantity sold

Total Revenue

The cumulative sum of funds a business accumulates from selling products or offering services over a specific duration.

Government

The organization or system by which a community or nation is governed, responsible for making and enforcing laws, policies, and regulations.