Restaurants do a large valine of business by credits and debit cards. Suppose spring Garden Salads restaurants had these transactions not January 28, 2018 **Requirements:**1. Suppose Spring Garden Salads' processor charges a 6% fee and deposits sales net of the fee. Journalize these sales transactions for the restaurant.2. Suppose Spring Garden Salads' processor charges a 6% fee and deposits sales using the gross method. Journalize these sales transactions for the restaurant.**Data Table:**- National Express credit card sales: $10,400- ValueCard debit card sales: $7,000**Instructions for Journal Entries:**To process these transactions, consider the following:- **Net Method:** Deduct the processor's fee before recording the sale. For example, calculate the fee by multiplying the sales amount by 6%. Subtract this fee from the original sales amount to find the net deposit.- **Gross Method:** Record the total sales before any deduction, and then separately record the fee as an expense.Understanding the implications of net and gross methods on financial statements is crucial for accurate financial recording and reporting. ### Understanding Account Transactions#### Journal Entry for Credit Card SalesIn the table shown, the journal entry records the financial transactions associated with credit card sales after accounting for transaction fees.**Journal Entry:**| Accounts and Explanation | Debit | Credit ||--------------------------|-------|---------|| Cash | 9,776 | || Credit Card Expense | 624 | || Sales Revenue | | 10,400 |**Explanation:** This entry reflects recorded credit card sales, net of the fee. The cash account is debited for $9,776, representing the net cash received. The credit card expense of $624 is also debited, reflecting the costs incurred due to the transaction fees. The sales revenue is credited for $10,400, representing the total sales before the deduction of expenses.#### Task: Journalize Debit Card SalesBelow is a blank table for users to fill out in order to practice journalizing debit card sales, net of any applicable fees:**Journal Entry:**| Accounts and Explanation | Debit | Credit ||--------------------------|-------|--------|| Cash | | || Credit Card Expense | | || Sales Revenue | | |**Instructions:** Enter the details of the debit card sales along with the deducted fees in the spaces provided. After filling out the table, click "Check Answer" to verify the accuracy of your entries.---This exercise helps in understanding the recording of credit and debit card sales, specifically how fees are accounted for in financial statements.

Credit card expense = Sales Revenue x 6% = $10,400 x 6% = $624 Debit card expense = Sales Revenue x…

1. Suppose Spring Garden Salads' processor charges a 6% fee and deposits sales net of the fee. Journalize these sales transactions for the restaurant. 2. Suppose Spring Garden Salads' processor charges a 6% fee and deposits sales using the gross method. Journalize these sales transactions for the restaurant. Print Done - X Data Table National Express credit card sales $ 10,400 ValueCard debit card sales 7,000

1. Suppose Spring Garden Salads' processor charges a 6% fee and deposits sales net of the fee. Journalize these sales transactions for the restaurant. 2. Suppose Spring Garden Salads' processor charges a 6% fee and deposits sales using the gross method. Journalize these sales transactions for the restaurant. Print Done - X Data Table National Express credit card sales $ 10,400 ValueCard debit card sales 7,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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