Question

Levine Company uses the perpetual inventory system.

Apr.		8		Sold merchandise for $8,800 (that had cost $6,503) and accepted the customer's Suntrust Bank Card. Suntrust charges a 4% fee.
		12		Sold merchandise for $8,600 (that had cost $5,573) and accepted the customer's Continental Card. Continental charges a 2.5% fee.

Prepare journal entries to record the above credit card transactions of Levine Company. (Round your answers to the nearest whole dollar amount.)

Answer 1

Date General Journal Debit Credit Apr-08 $8,448 $ 352 Cash Credit card expense Sales (Sale of merchandise, receipt of cash and credit card charges recorded) $8,800 Apr-08 $6,503 Cost of Goods Sold Merchandise Inventory Cost of goods sold recorded) $6,503 Apr-12 $ 8,385 $ 215 Cash Credit card expense Sales Sale of merchandise, receipt of cash and credit card charges recorded) $8,600 Apr-12 $5,573 Cost of Goods Sold Merchandise Inventory (Cost of goods sold recorded) $5,573

Working Notes Credit card expense charged by Sun trust Bank = $ 8800*4%= Credit card expense charged by Continental = $ 8600 *2.5 %= $ 352 $ 215