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On February 1,2017, Jones Company factored receivables with a carrying amount of $500,000 to Smith...

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Accounting

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On February 1,2017, Jones Company factored receivables with a carrying amount of $500,000 to Smith Company. Smith Company assesses a finance charge of 5% of the receivables and retains 5% of the receivables. Assume that Jones factors the receivables on a without-recourse basis. Jones' journal entry to record the transfer would include a O debit to Loss on Sale of Receivables for $40,000 O credit to Cash for $460,000 O credit to Loss on Sale of Receivables for $15,000 O debit to Cash for $475,000 O credit to Accounts Receivable for $500,000

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