Sun Inc Assigns $3,000,000 of Its Accounts Receivables as Collateral

Multiple Choice

Sun Inc assigns $3,000,000 of its accounts receivables as collateral for a $1 million 8% loan with a bank. Sun Inc. also pays a finance fee of 1% on the transaction upfront. What would be recorded as a gain (loss) on the transfer of receivables?

A) Loss of $30,000.
B) Loss of $240,000.
C) Loss of $270,000.
D) $0.