Asked by Jason Fitch on May 14, 2024
Verified
If a company usually sells its accounts receivable, it records any factoring commissions as a(n)
A) loss
B) expense
C) receivable
D) liability
Factoring Commissions
Factoring commissions are fees paid to a factor, or financial intermediary, for advancing funds to a business by purchasing its accounts receivable.
Accounts Receivable
Amounts owed to a business by its customers for goods or services delivered or used but not yet paid for.
Loss
The result when a company's expenses exceed its revenues during a specific period of time.
- Master the accounting processes involved in the sales of accounts receivable, including factoring and assignment, and analyze their influence on financial statements.
Verified Answer
Learning Objectives
- Master the accounting processes involved in the sales of accounts receivable, including factoring and assignment, and analyze their influence on financial statements.
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