Asked by Jacob Andersen on May 16, 2024
Verified
Gemstone Products allows customers to use bank credit cards to charge purchases.The bank used by Gemstone Products processes all bank credit cards in exchange for a 3% processing fee and all credit card receipts deposited are credited to the company account on the day of deposit.Assume that on January 18,Gemstone Products sold and deposited $18,000 worth of bank credit card receipts.Prepare the general journal entry to record this transaction.
Processing Fee
A charge assessed for processing a transaction, application, or request, common in financial services.
Bank Credit Cards
Financial instruments issued by banks that allow users to borrow funds for purchases or cash advances, subject to repayment terms and interest.
Journal Entry
A record of a financial transaction in an accounting system, showing the accounts affected and the amounts.
- Facilitate the documentation of journal entries for sales-related transactions, particularly those involving credit sales and the use of credit cards.
- Recognize how service fees influence sales transactions that use credit cards.
Verified Answer
Learning Objectives
- Facilitate the documentation of journal entries for sales-related transactions, particularly those involving credit sales and the use of credit cards.
- Recognize how service fees influence sales transactions that use credit cards.
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