Restaurants do a large volume of business by credit and debit cards. Suppose Cho

Question

Restaurants do a large volume of business by credit and debit cards. Suppose Chocolate Passion restaurant had these transactions on January 28, 2018:

Read the Requirements.

1.) Suppose Chocolate Passions processor charges a 3% fee and deposits sales net of the fee. Journalize these sales transactions for the restaurant.

2.) Suppose Chocolate Passion's processor charges 3% fee and deposits sales using the gross method. Journalize these sales transactions for the restaurant.

Restaurants do a large volume of business by credit and debit cards. Suppose Chocolate Passion restaurant had these transactions on January 28, 2018 EEB (Click the icon to view the transactions) Read the requirements Requirement 1 . Suppose Chocolate Passion's processor charges a 3% fee and deposits sales net of the fee. Journalize these sale transactions for the restaurant. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Journalize the credit sales net of the fee, first. Accounts and Explanation Debit Credit Credit Card Expense Cash 10,476 Sales Revenue 10,800 Recorded credit card sales, net of fee Now journalize the debit card sales net of the fee. Accounts and Explanation DebitCredit

Explanation / Answer

1. Answer to Question 1 : Journal entries for Net Sales method -Revenue recorded after net of charges or expenses, if any

1. Processor charges -Credit card expense a/c Dr

Cash a/c Dr

To Sales Revenue a/c

(being sales through National express credit card have been recorded with the corresponding processing charges)

324

10476

10800

2. Processing charges -Debit card expense a/c Dr

Cash a/c Dr

To Sales revenue a/c

(being sales through Value card debit card have been recorded with the corresponding processing charges)

270

8730

9000

2.. Answer to Question 2 : Journal entries for Gross Sales method -Revenue recorded on Gross basis

1. Cash a/c Dr

To Sales Revenue a/c

(being sales through National express credit card have been recorded under gross sales method)

10800

10800

2. Cash a/c Dr

To Sales revenue a/c

(being sales through Value card debit card have been recorded under gross sales method )

9000

9000

Accounts and Explainations Debit Credit   

1. Processor charges -Credit card expense a/c Dr

Cash a/c Dr

To Sales Revenue a/c

(being sales through National express credit card have been recorded with the corresponding processing charges)

324

10476

10800

2. Processing charges -Debit card expense a/c Dr

Cash a/c Dr

To Sales revenue a/c

(being sales through Value card debit card have been recorded with the corresponding processing charges)

270

8730

9000

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