What is "recourse" as it relates to selling receivables?
a The obligation of the seller of the receivables to pay the purchaser in case the debtor
fails to pay.
b The obligation of the purchaser of the receivables to pay the seller in case the debtor
fails to pay.
c The obligation of the seller of the receivables to pay the purchaser in case the debtor
returns the product related to the sale.
d The obligation of the purchaser of the receivables to pay the seller if all of the
receivables are collected.
Moon Inc. factors $ of its accounts receivables without recourse for a finance
charge of The finance company retains an amount equal to of the accounts
receivable for possible adjustments. Moon estimates the fair value of the recourse liability
at $ What would be the debit to Cash in the journal entry to record this transaction?
a $
b $
c $
d $
