a quick question:
i have a debt of 100 on my books as receivable.
i factor it and get 100 and the terms are such that its a loan.
so i will setup the entry as follows:
Dr Debts Factored (or whatever its formally called) 100
Cr Liability 100
------------------------
and the balance in Receivables remains in the books as it is. .. correct?
now, lets say i get 80 from the factor and its still a loan
Dr Debts Factored 80
Liability 80
------------------------
and the balance in Receivables remains in the books as it is. .. correct?
thanks
Ask the Tutor ACCA FR
factoring
please ignore .. the debit shd be cash!!...
And the last 20 debit should be expenses
And you're never in this world going to get $100 for factoring $100 of debt
And basically the entry is
Dr Cash 80
Dr Finance Costs 20
Cr Loan Account 100
OK?
thank u!
You're welcome
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