Answer:
Explanation:
The journal entries are shown below:
1. Cash A/c Dr $19,000
Credit card expense A/c Dr $1,000 ($20,000 × 5%)
To Sales A/c $20,000
(Being cash is received)
Cost of goods sold A/c Dr $15,000
To Merchandise inventory A/c $15,000
(Being inventory is sold at cost)
2. Accounts receivable A/c Dr $4,800
Credit card expense A/c Dr $200 ($5,000 × 4%)
To Sales A/c $5,000
(Being merchandise is sold on credit)
Cost of goods sold A/c Dr $3,000
To Merchandise inventory A/c $3,000
(Being inventory is sold at cost)
Cash A/c Dr $4,800
To Accounts receivable $4,800
(Being cash is received)
If the company sold $20,000 of merchandise, which cost $15,000, on Mastercard credit cards. Mastercard charges a 5% fee. The appropriate journal entries to record the credit card sales transaction will be:
Journal entries
1. Debit Cash $19,000
[(100%-5%)×$20,000]
Debit Card expense $1,000
(5%×$20,000)
Credit Sales $20,000
Debit Cost of goods sold $15,000
Credit Merchandise Inventory $15,000
2. Debit Cash $4,800
[(100%-4%)×$5,000]
Debit Card expense $200
(4%×$5,000)
Credit Sales $5,000
Debit Cost of goods sold $3,000
Credit Merchandise Inventory $3,000
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