restaurants do a large volume of business by credit and debit cards. suppose chocolate passion restaurant…
restaurants do a large volume of business by credit and debit cards. suppose chocolate passion restaurant had these transactions on january 28. requirement 2. suppose chocolate passions processor charges a 6% fee and deposits sales using the gross method. assume that on january 28, the company pays the fees assessed by the credit - card processor. journalize these sales transactions for the restaurant. (for purposes of this problem, only record the sales revenue portion of these transactions using the gross method. record debits first, then credits. select the explanation on the last line of the journal entry table.) first journalize the credit sales using the gross method
Answer
Explanation:
Step1: Calculate credit - card fee for National Express credit card sales
The credit - card fee is 6% of the sales amount. For National Express credit card sales of $20,400, the fee is $20,400\times0.06 = 1224$.
Step2: Determine the amount of cash received for National Express credit card sales
The amount of cash received is the sales amount minus the fee, so $20,400 - 1224=19176$.
Step3: Journalize National Express credit card sales
Debit: Cash $19,176$ Debit: Credit Card Expense $1,224$ Credit: Sales Revenue $20,400$ Explanation: To record National Express credit card sales using the gross method. The business receives cash net of the fee, incurs a credit - card expense for the fee amount, and records the full sales revenue.
Step4: Journalize ValueCard debit card sales
Debit: Cash $7,520$ Debit: Credit Card Expense $480$ Credit: Sales Revenue $8,000$ Explanation: To record ValueCard debit card sales using the gross method. The business receives cash net of the fee, incurs a credit - card expense for the fee amount, and records the full sales revenue.
Answer:
| Date | Accounts and Explanation | Debit | Credit |
|---|---|---|---|
| Jan 28 | Cash | $19,176$ | |
| Credit Card Expense | $1,224$ | ||
| Sales Revenue | $20,400$ | ||
| Jan 28 | Cash | $7,520$ | |
| Credit Card Expense | $480$ | ||
| Sales Revenue | $8,000$ | ||
| (To record credit and debit card sales using the gross method) |