Log out Go to App
Go to App

Learning Materials

Features

Discover

Chapter 7: Q19E (page 417)

Journalizing credit card sales 2018

Sep. 1 Recorded National Express credit card sales for \(96,000, net of processor fee of 1%. Ignore Cost of Goods Sold.

15 Recorded ValueMax credit card sales of \)80,000. Processor charges a 1.5% fee. ValueMax charges the fee at the end of the month, therefore Marathon uses the gross method for these credit card sales. Ignore Cost of Goods Sold.

30 ValueMax collected the fees for the month of September. Assume the

September 15 transaction is the only ValueMax credit card sale. Journalize all entries required for Marathon Running Shoes.

Short Answer

Expert verified

The credit card expense is $960.

Step by step solution

01

Step-by-Step SolutionStep 1: Definition of credit card

A credit card is a particular type of card that facilities customers to buy goods on credit.

02

Journal entries for credit card sale

Date

Particulars

Debit

Credit

2018

September 1

Cash

$95,040

Credit Card Expense

$960

Sales Revenue

$96,000

(Being entry of the credit card sale)

September 15

Cash

$96,000

Sales Revenue

$96,000

(Being entry of the credit card sale)

September 30

Credit Card Expense

$960

Cash

$960

(Being entry for the payment of processing fee)

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

Fill in the missing information concerning how companies control cash received by mail.

a. The ________ opens the mail and sends customer checks to the treasurer.

b. The ________ deposits the customer checks in the bank.

c. The ________ uses the remittance advices to record the journal entries for cash receipts.

d. The ________ compares the bank deposit to the journal entry for cash receipts.

The Scott Sun & Shade Company had the following financial data at December 31, 2018:

Cash and cash equivalents $ 60,000

Total current liabilities 75,000

What is the cash ratio as of December 31, 2018, for Scott Sun & Shade?

Phoenix Restaurants accepts credit and debit cards as forms of payment. Assume Phoenix had $12,000 of credit and debit card

sales on June 30, 2017.

9. Suppose Phoenix’s processor charges a 2% fee and deposits sales net of the fee. Journalize the sale transaction for the

restaurant.

10. Suppose Phoenix’s processor charges a 2% fee and deposits sales using the gross method. Journalize the sale transaction for

the restaurant.

Question: How does the Sarbanes-Oxley Act relate to internal controls?

What are some common controls used with a bank account?
See all solutions

Recommended explanations on Business Studies Textbooks

Organizational Communication

Read Explanation

Business Case Studies

Read Explanation

Financial Performance

Read Explanation

Managerial Economics

Read Explanation

Nature of Business

Read Explanation

Strategic Analysis

Read Explanation
View all explanations

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free