In deciding whether financing with receivables is a secured borrowing or a sale under IFRS, the critical element is the extent to which the:
Added by William M.
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Secured borrowing involves obtaining financing by using receivables as collateral, while a sale of receivables involves transferring the rights to the receivables to another party. Show more…
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According to standard, determining whether receivables that are transferred can be derecognized and accounted for as a sale is based on... • a. whether the seller has transferred substantially all the risks and rewards of ownership of the receivables. • b. whether the seller has transferred the receivables to factoring company or bank. • c. whether the seller has received cash from factoring company or bank. • d. whether the seller has received cash from customer.
Akash M.
Which of the following is true when accounts receivable are factored without recourse? O a. The risks and rewards of these receivables still remain with the seller. O b. The factor assumes the risk of collectibility and absorbs any credit losses in collecting the receivables. O c. The transaction may be accounted for either as a secured borrowing or as a sale, depending upon the substance of the transaction. • d. The receivables are used as collateral for a promissory note issued to the factor by the owner of the receivables.
which form of receivable financingis equivalentto the absolute se of accounts receivable is it: 1 pledge of AR 2Assignment of AR 3 Factoring 4 discounting of notes receivable
Rabia S.
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