Bramble Corp. accepted a national credit card for a $10200 purchase. The cost of the goods sold is $6200. The credit card company charges a 2% fee. What is the impact of this transaction on net operating income?

Question

Erica Dillon

Business

6 April, 02:59

Bramble Corp. accepted a national credit card for a $10200 purchase. The cost of the goods sold is $6200. The credit card company charges a 2% fee. What is the impact of this transaction on net operating income?

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Answers (2)

Know the Answer?

Lena Kerr · Answer 1

The impact of the this transaction on the net operating income = $ 10200 - $ 6200 - (0.02 * $ 10200) = $ 3796

Michaela · Answer 2

It reduces the net operating income by $2,040

Explanation:

The charge of 2% on sales is part of the selling and distribution expense which would be deducted from the gross profit to get the operating profit or net income / (loss).

The credit card charge amounts to

= 2% * $102,000

= $2,040

As such, the charge by the credit card company reduces net operating income by $2,040.