Sun inc. factors 3000000 of its accounts receivables with, Ask an Expert

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Sun Inc. factors $3,000,000 of its accounts receivables with recourse for a finance charge of 3%. The finance company retains an amount equal to 10% of the accounts receivable for possible adjustments. Sun estimates the fair value of the recourse liability at $150,000. What would be recorded as a gain (loss) on the transfer of receivables? Loss of $240,000.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M960927

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