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11. Mountain High Ice Cream Company factored $60,000 of accounts receivable to the Prudential Bank....

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Accounting

11. Mountain High Ice Cream Company factored $60,000 of accounts receivable to the Prudential Bank. The arrangement was made without recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10%. When the bank collects the receivables, it will remit to Mountain High the retained amount less a 2% fee (2% of the total factored amount). Prepare the journal entry to record the transfer on the books of Mountain High assuming the sale criteria are met.

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