On January 1, 2013, XYZ Inc. assigned $500,000 of their A/R to Finance, Inc. Finance...
80.2K
Verified Solution
Link Copied!
Question
Accounting
On January 1, 2013, XYZ Inc. assigned $500,000 of their A/R to Finance, Inc. Finance agreed to pay XYZ 80% of its assigned A/R in cash, less a $10,000 service charge. Finance will also charge 12% interest on any outstanding balances. On the last day of each month, ABC remitted the cash collected from assigned accounts to Finance, Inc.
At the end of January, XYZ collected $200,000 in assigned A/R and also had $10,000 in sales returns during the month.
By the end of February, XYZ collected another $80,000 of assigned A/R less sales discounts taken in the amount of $2,500 during the month.
What is the balance in the Note Payable account at the end of February?
What is the balance in the A/R Assigned account at the end of February?
What is the net effect on net income of all the transactions in 2013 related to the assigned accounts?
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
