Accounting for Credit Card Sales Chassoul & Company pays a three percent credit

Question

Accounting for Credit Card Sales Chassoul & Company pays a three percent credit card fee on all credit sales, and receives a cash deposit immediately following each credit card transaction. If credit sales for the company total $30,000 on January 15, what journal entry should be recorded to recognize the receipt of cash and the credit card fee expense? Debit Cash $29,100; debit Credit Card Fee Expense $900. Debit Cash $29,100; credit Credit Card Fee Expense $900. Debit Cash $30,900; debit Credit Card Fee Expense $900. Debit Cash $30,900; credit Credit Card Fee Expense $900.

Explanation / Answer

Solution:

Debit Cash $29,100; debit Credit Card Fee Expense $900

Explanation:
= $30,000 - ($30,000 x 3%)

= $30,000 - $900

= $29,100

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