Brief Exercise 7-9 On October 1, 2017, Culver, Inc. assigns $1,205,800 of its ac

Question

Brief Exercise 7-9 On October 1, 2017, Culver, Inc. assigns $1,205,800 of its accounts receivable to Larkspur National Bank as collateral for a $722,900 note. The bank assesses a finance charge of 3% of the receivables assigned and interest on the note of 9% Prepare the October 1 journal entries for both Culver and Larkspur. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Oct. 1 Larkspur National Bank Oct. 1 Click if you would like to Show Work for this question: Open Show Work

Explanation / Answer

Culver inc. Oct-01 Cash 686726 Interest Expense 36174 =1205800*3%        Notes Payable 722900 Larkspur National Bank Oct-01 Notes Receivable 722900         Cash 686726         Interest Revenue 36174

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