Journal entry to record collection from credit card company

Assignment Help Financial Accounting

Reference no: EM13905663

MacKenzie Company sold $180 of merchandise to a customer who used a Regional Bank credit card. Regional Bank deducts a 4% service charge for sales on its credit cards. MacKenzie electronically remits the credit card sales receipts to the credit card company and receives payment in approximately 5 days. The journal entry to record the collection from the credit card company would be:

A. Debit Cash of $172.80 and credit Accounts Receivable—Regional $172.80.

B. Debit Cash of $180; credit Card Expense $7.20 and credit Accounts Receivable $172.80.

C. Debit Accounts Receivable—Regional $172.80; debit Credit Card Expense $7.20 and credit Sales $180.

D. Debit Cash $172.80; debit Credit Card Expense $7.20 and credit Sales $180.

E. Debit Cash $172.80 and credit Sales $172.80.

Reference no: EM13905663

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