In this case, Company A has pledged $200,000 of accounts in exchange for a loan of $100,000.
Assignment of accounts receivable is a written agreement between a lender and a borrower in which the borrower pledges accounts receivable as collateral.
Usually, the borrowing company would itself collect the assigned receivables and remit the loan amount as per agreement.
It is only when the borrower fails to pay as per agreement, that the lender gets a right to collect the assigned receivables on its own.
For a fuller explanation of journal entries, view our examples section, and our tutorial on receivables financing.