Prepare journal entries for the following credit card sales transactions (the company uses the perpetual inventory system). Sold $21,000 of merchandise, which cost $15,800, on Mastercard credit cards. Mastercard charges a 5% fee. Sold $5,100 of merchandise, which cost $3,050, on an assortment of bank credit cards. These cards charge a 4% fee.

Prepare journal entries for the following credit card sales transactions (the company uses the perpetual inventory system). Sold $21,000 of merchandise, which cost $15,800, on Mastercard credit cards. Mastercard charges a 5% fee. Sold $5,100 of merchandise, which cost $3,050, on an assortment of bank credit cards. These cards charge a 4% fee.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 4Q: American Signs allows customers to pay with their Jones credit card and cash. Jones charges American...

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Concept explainers

Credit card

A credit card is provided by financial institutions or banks, which permits a person to borrow money on a preapproved limit for purchases on a credit basis. The credit limit is decided by the institution and bank which issues a credit card depending on the person’s credit score and income. A cardholder can use the card for credit purchases, a balance transfer, cash advances.

Question

Prepare journal entries for the following credit card sales transactions (the company uses the perpetual inventory system).

Sold $21,000 of merchandise, which cost $15,800, on Mastercard credit cards. Mastercard charges a 5% fee.
Sold $5,100 of merchandise, which cost $3,050, on an assortment of bank credit cards. These cards charge a 4% fee.

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

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nces Levine Company uses the perpetual inventory system. April 8 Sold merchandise for $8,500 (that had cost $6,282) and accepted the customer's Suntrust Bank Card. Suntrust charges a 4% fee. April 12 Sold merchandise for $9,800 (that had cost $6,350) and accepted the customer's Continental Card. Continental charges a 2.5% fee. Prepare journal entries to record the above credit card transactions of Levine Company. Note: Round your answers to the nearest whole dollar amount. View transaction list View journal entry worksheet i No 1 2 3 4 Date April 08 April 08 April 12 April 12 Cash Credit card expense Sales Cost of goods sold Merchandise inventory Cash Credit card expense Sales Cost of goods sold Merchandise inventory General Journal Debit 8,160 340 6,000 9,555 245 6,350 Credit 8,500 6,000 9,800 6,350 Ⓒ
MacKenzie Company sold $480 of merchandise to a customer who used a Regional Bank credit card. Regional Bank charges a 2.0% fee for sales on its credit cards. The Journal entry to record this sales transaction would be: Multiple Choice Debit Cash of $480 and credit Accounts Receivable $480. Debit Cash $470.40; debit Credit Card Expense $9.60 and credit Sales $480. O Debit Cash $470.40 and credit Sales $470.40. O Debit Cash of $480 and credit Sales $480. O Debit Accounts Receivable $480 and credit Sales $480.
MacKenzie Company sold $220 of merchandise to a customer who used a Regional Bank credit card. Regional Bank charges a 5.0% fee for sales on its credit cards. The journal entry to record this sales transaction would be: Multiple Choice Debit Cash $209.00; debit Credit Card Expense $11.00 and credit Sales $220. Debit Cash of $220 and credit Accounts Receivable-Regional $220. Debit Cash of $220 and credit Sales $220. О Debit Cash $209.00 and credit Sales $209.00. О Debit Accounts Receivable-Regional $209.00; debit Credit Card Expense $11.00 and credit Sales $220.