Topeka Stores accepts both its own and national credit cards. During the year th
ID: 2346038 • Letter: T
Question
Topeka Stores accepts both its own and national credit cards. During the year the following selected summary transactions occurred.Jan. 15 Made Topeka credit card sales totaling $18,000. (There were no balances prior to January 15.)
20 Made Visa credit card sales (service charge fee 2%) totaling $4,300.
Feb. 10 Collected $10,000 on Topeka credit card sales.
15 Added finance charges of 1% to Topeka credit card balance.
Journalize the transactions for Topeka Stores. (For multiple debit/credit entries, list amounts from largest to smallest e.g. 10, 5, 3, 2.)
Explanation / Answer
A store's own credit card is treated as an accounts receivable, while bank cards are treated as cash.
Jan. 15 Made Topeka credit card sales totaling $18,000.
(There were no balances prior to January 15.)
Dr Accounts Receivable 18,000
Cr Sales
20 Made Visa credit card sales (service charge fee 2%) totaling $4,300.
4,300 x 2% = $86 credit card fees
Dr Cash 4,214
Dr Bank Card Fee Expense 86
Cr Sales 4,300
Feb. 10 Collected $10,000 on Topeka credit card sales.
Dr Cash 10,000
Cr Accounts Receivable 10,000
15 Added finance charges of 1% to Topeka credit card balance.
8,000 x 1% = $80
Dr Accounts Receivable 80
Cr Interest Revenue 80