CHAPTER 8
notification and non notification basis
assignment can be done either on a
true
assignment is specific because specific a/r serve as collateral security for the loan
pledge of a/r assignment of a/r factoring of a/r discounting of a/r
common forms of receivable financing
true
during a general business decline, an entity may find itself in tight cash position because sales decrease and customers are not paying their accounts on time. under these circumstances, if the situation becomes very critical, the entity may be forced to look for cash by financing its receivables
receivable financing
financial flexibility or capability of an entity to raise money out of its receivables
statement presentation of liab and disclosure
if in pledging of a/r, waay na settle at year-end, kinanglan mag present ka
lantawon if sino an naga collect bank - notif assignor, payee, entity - non notif
if the problem doesn't state whether it is a notification or non notification, paano mo maman an?
pledge of accounts receivable
in this form of receivable financing, no complex problems are involved except the accounting for loan
pledge of accounts receivable
in this form of receivable financing, the borrowing entity makes collections of the pledged accounts but may be required to turn over the collections to the bank in satisfaction of the loan
pledge of accounts receivable
in this form of receivable financing, when loans are obtained from the bank or any lending institution, the accounts receivable may be pledged as collateral security for the payment of the loan
assignement of a/r
means that a borrower called ASSIGNOR transfer rights(bank have the right to collect) in some a/r to a lender called assignee in consideration for a loan
true
pledging is general because all a/r serve as a collateral security for the loan
true
the assignee usually charges interest for the loan it makes and requires a service or financing charge or commission for the assignment agreement (normally deducted sa cash to be released) - ginansya ka bank
assignment
this is a more formal type of pledging of a/r. this is a secured borrowing evidenced by a financing agreement and a promissory note both of which assignore signs
customers are not informed that their accounts have been assigned. as a result, the customers continue to make payments to the assignor who in turn remits the collections to the assignee
when accounts are assigned on a nonnotification basis,
customers are notified to make payments directly to asignee
when accounts are assigned on a notif basis,
true
with respect to pledged accounts, no entry would be necessary. it is sufficient that disclosure thereof is made in a note to f/s