To obtain additional cash A&E Corporation factors $200000 of its accounts rece

To obtain additional cash A&E Corporation factors $200000 of its accounts receivable to PVP Corporation. PVP assesses a finance charge
of 5 percent of the amount of accounts receivable and retains an amount equal to 3 percent of accounts receivable to cover sales discounts returns and
allowances.

a.Assuming that this transaction is on a without recourse basis prepare a journal entry on the books of PVP
Corporation to record this transaction. Show computations and prepare your journal entry using the answer sheet provided.

b.Assuming that this transaction is on a with recourse basis prepare a journal entry on the books of A&E
Corporation to record this transaction. Assume that A&E has determined the recourse obligation to be $6000. Show computations and prepare your journal
entry using the answer sheet provided.