Question

Gemstone P used by Gem and all cred stone Products allows customers to use bank credit cards to charge purchases. The bank by Gemstone Products processes all bank credit cards in exchange for a 3% processing fee all credit card receipts deposited are credited to the company account on the day of deposit. ssume 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. 9) Pepperdine reported net sales of $8,600 million, net income of $126 million and average accounts receivable of $890 million. Its accounts receivable turnover is: A) 37.8. B) 9.7. C) 68.3. D) 7.1. E) 51.7. 10) A promissory note: A) Is a short-term investment for the maker. B) Is a written promise to pay a specified amount of money at a certain date. C) Is a liability to the payee. D) Is another name for an installment receivable. E) Cannot be used in payment of an account receivable. 11) The maturity date of a note receivable: A) Is the day of the credit sale. B) Is the day the note was signed. C) Is the day the note is due to be repaid. D) Is the date of the first payment. E) Is the last day of the month. 12) A company receives a 10%, 120-day note for $1,500. The total interest due on the maturity date is: (Use 360 days a year.) A) $50.00 B) $150.00 C) $75.00 D) $37.50. E) $87.50.

Answer 1

8…	Debit	Credit
Cash	18000		(Depoited amt.)
Credit card fees(18000/97*3)	557
Sales revenue		18557

9.Accounts receivables T.O.=

Net credit sales/Average Accounts receivables

ie.8600/890

9.7

times

ANSWER: B) 9.7

10.A promissory Note :

B) is a written promise to pay a specified amount of money at a certain time.

It is basically a liability to the payer/maker or the one who promises /one who owes money to the payee.

so, A,C,D& E do not apply.

It is an asset to the payee.

11.The maturity date of a note receivable :

C) is the day the note is due to be repaid.

12.Total interest due =

1500*10%*120/360=

50

ANSWER: A) $ 50.00