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08.07.2022 - 04:34

Melody, Inc., accepts a national credit card The collection fee is 6%. If credit card sales are $500, the correct journal entry is: a. Accounts Receivable 470 Sales 470 b. Accounts Receivable 470 Credit Card Expense 30 Sales 500 c. Accounts Receivable

Question:

Melody, Inc., accepts a national credit card The collection fee is 6%. If credit card sales are $500, the correct journal entry is:

a.

Accounts Receivable	470
Sales	470

b.

Accounts Receivable	470
Credit Card Expense	30
Sales	500

c.

Accounts Receivable	500
Sales	500

d.

Accounts Receivable	500
Credit Card Discount	30
Sales	470

Answers (1)

Enid April 13, 2023 в 05:45

The correct journal entry is (b). This is because when accepting credit cards, the business incurs a fee known as a credit card expense or collection fee. In this case, the fee is 6% of the $500 credit card sales, which equals $30. The accounts receivable account is credited for the net amount (sales minus the fee), which is $470, and the credit card expense account is debited for the amount of the fee ($30). The sales account is also debited for the total amount of the sale ($500). Therefore, the correct journal entry is: Accounts Receivable 470 Credit Card Expense 30 Sales 500

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