What is assignment of accounts receivable?

Assignment of accounts receivable is a method of debt financing whereby the lender takes over the borrowing company's receivables. This form of alternative financing is often seen as less desirable, as it can be quite costly to the borrower, with APRs as high as 100% annualized.

What is an assignment of receivables?

Assignment of accounts receivable is a method of debt financing whereby the lender takes over the borrowing company's receivables. This form of alternative financing is often seen as less desirable, as it can be quite costly to the borrower, with APRs as high as 100% annualized.

Form Assignment Accounts Receivable With Credit Card Payments In Salt Lake

Category:

Contracts - Factoring

State:

Multi-State

County:

Salt Lake

Control #:

US-00037DR

Format:

Instant download

Description

The Form Assignment Accounts Receivable with Credit Card Payments in Salt Lake is a legal document establishing a factoring agreement between a seller and a factor. This agreement allows the seller to assign its accounts receivable, including credit card payments, to the factor in exchange for immediate funds. Key features of the form include the assignment of future receivables, credit approval requirements, and the factor's assumption of credit risks associated with the purchased accounts. The form provides instructions for filling out various sections, including business information, purchase price calculations, and rights delegation. Target audiences such as attorneys, partners, owners, associates, paralegals, and legal assistants can utilize this form to facilitate quick cash flow and manage credit risks effectively. It also addresses terms regarding the collection of payments and warranty conditions, ensuring both parties adhere to the agreement's stipulations. Additionally, the form outlines the necessary documentation and procedures involved in the assignment process, providing clarity and structure for effective business transactions.

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FAQ

In QuickBooks, a credit card payment is treated as a liability payment, as it reduces your outstanding credit card balance. It is not considered a direct business expense, but rather the repayment of funds that were borrowed to cover business expenses.

Record the total debit amount in the accounts receivable account ing to the invoice. When the customer pays the invoice in full, post a debit in the sales account. This helps balance the double-entry system, which can help you avoid accounting errors and balance books more effectively.

All DoD guidance and regulations indicate that sales of merchandise or services to an authorized customer using a credit card should be recorded as a receivable.

Assignment of accounts receivable is a method of debt financing whereby the lender takes over the borrowing company's receivables. This form of alternative financing is often seen as less desirable, as it can be quite costly to the borrower, with APRs as high as 100% annualized.