Woodstock Co. had $500 of credit cards sales. The net cash receipts were deposited immediately into Woodstock's bank account less a 2% fee. The entry to record this sales transaction would include a credit to:

Question

Poochie

Business

13 March, 13:10

Woodstock Co. had $500 of credit cards sales. The net cash receipts were deposited immediately into Woodstock's bank account less a 2% fee. The entry to record this sales transaction would include a credit to:

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Answers (1)

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Meadow Espinoza · Answer 1

Sales revenue for $500

Explanation:

The journal entry is shown below:

Account receivable Dr $490

Credit card expense Dr $10

To Sales revenue $500

(Being the sale transaction is recorded)

The account receivable is computed below:

= Sales revenue - sales revenue * fee percentage given

= $500 - $500 * 2%

= $500 - $10

= $490

And, the credit card expense is

= Sales revenue * fee percentage given

= $500 * 2%

= $10