1. The journal entry in the seller’s books to record an account deemed uncollect

Question

1. The journal entry in the seller’s books to record an account deemed uncollectible in a factoring agreement with recourse would include a

a. Debit to Bad Debt Expense

b. Debit to Allowance for Uncollectible Accounts

c. Debit to Accounts Receivable

d. None of the above

2. The journal entry in the buyer’s books to record the honoring by the seller of an account deemed uncollectible in a factoring agreement with recourse would include a

a. Debit to Bad Debt Expense

b. Debit to Allowance for Uncollectible Accounts

c. Debit to Cash

d. Debit to Loss on Factoring Agreement

Explanation / Answer

1)Debit to Allowance for Uncollectible accounts

2)Debit to loss on Factoring agreement

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