On April 1, Golden, Inc. factored $80,000 of its accounts receivable without recourse. The factor retained 10% of the accounts receivable as an allowance for sales returns and charged a 5% commission on the gross amount of the factored receivables. What amount of cash did Golden receive from the factored receivables? 
A. $68,000 
B. $68,400 
C. $72,000 
D. $76,000
Answer:A
This answer is correct. The proceeds from the factored accounts receivable is $80,000 less the 10% factor holdback of $8,000 ($80,000 × 10%), and less the 5% commission on the gross amount of receivables ($80,000 × 5%). Therefore, this answer is correct because the amount received from factoring the accounts receivable is $68,000 ($80,000 ? $8,000 ? $4,000).