Question

Alpha Company sold goods to customers who used Under-the-Hill bank credit cards. Credit card sales on July 8, 2016 amounted to $12,000 and were subject to a 2.5% bank fee. Use this information to prepare the General Journal entry (without explanation) for July 8, 2016. If no entry is required then write "No Entry Required."

Answer 1

Answer:

Accounts receivables -under-the-Hill   11,700 debit

credit card fees expense                          300 debit

            sales revenues                                      12,000 credit

Explanation:

The credit card fee is considered an expense

$12,000 x 0.025 = 300

We will debit our accounts receivables for the difference between the 12,000 billed and the fee charged for Under-the-Hill credit car:

12,000 - 300 0 11,700