Why this is mistaken
A secured borrowing leaves the receivables and related allowance recognized. Record the cash and financing liability separately, then continue the collection, loss, remittance, and disclosure schedules.
Where to watch
When this mistake may appear
- A lender advances cash against receivables and receives collection rights.
Check your work
Your work may contain this mistake if:
- Credits receivables instead of recording a borrowing under the supplied secured-borrowing path.