Loss on sale of receivables
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Joe Novak Corporation factored, with recourse $100,000 of accounts receivable with Huskie financing. The finance charge is 3% and 5% was retained to cover sales discounts, sales returns, and sales allowances. Joe Novak estimates the recourse obligation at $2400. What amount should Joe Novak report as a loss on sale of receivables?
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Solution Summary
The solution explains how to calculate the loss on sale of receivables due to factoring.
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