Problem 7-4A Credit card and debit card transactions LO5 Help Me SOLVE IT On September 5,...
Problem 7-4A Credit card and debit card transactions LO5 Help Me SOLVE IT On September 5, Maria Smith, owner of Super Gym Personal Service, provided personal training services to customers for cash of $3,500. Services of $9,000 were billed to corporate clients, terms 2/10, n/30. In the gym Maria uses a Square card reader that attaches to her iPhone, and other services totalling $18,000 were recorded on September 20 for customers using MasterCard (assume a 3.25% fee). On September 25, sales of $7,000 were made to debit card customers, also using the Square reader on her phone. The bank charges Maria a flat fee of 0.75% on all debit card transactions. Required Prepare journal entries for each of the transactions described. Analysis Component: Identify the advantages and disadvantages of each type of sale: cash sale, credit sale, credit card sale, or debit card sale. Explain why Maria would likely accept all these types of payment
Homework Answers
1. PREPRATION OF
JOURNAL ENTRIES FOR MARIA SMITH
ON September,5
Cash A/c Dr. $3500
to Sales A/c $3500
(Being cash sales
recorded)
ON SEPTEMBER,5
Corporate clients (Debtors) Dr. $9000
to sales A/c $9000
(being credit sale
recorded)
ON
SEPTEMBER,20
Cash A/c Dr. $17391.30
Master card fee A/c Dr. $608.70
to sales A/c $18000
(being sales make
to customers usind master card)
ON
SEPTEMBER,25
Cash A/c Dr. $6947.89
Bank charges A/c Dr. $52.11
to sale $7000
(Being sale make to customerd using dabit
card)
Adavantages and
disadvantages of the follwing typs os sale :
i)Cash
sale
Advantages:
1. In cash sale cash buying and selling business allows
the owner to be free from fear of bad debts.
2. The biggest advantage to paying with cash is
that you're limited to how much you can spend.
Disadvantages: 1.
Money in the drawer can be tempting for some employees to
steal.
2.Money at your location increases your risk for
theft not just from employees but criminals as well.
ii)Credit
sale
Advantages:
1.Competitive edge. Offering trade credit will
give you a competitive edge over your business rivals.
2. increase in sales
3. Better customer loyality
Disadvantages: 1. It
can lead to bad debts. There is no guarantee that the customers
will pay back.
2.Liquidity problems.
3. Loss of income/capital.
iii) Credit card
sale
Advantages: Easier Than Ever. It's also easier than
ever before to accept card payments. Increase Your
Sales. It's a simple fact that people don't carry
large amounts of cash.
Disadvantages:
- Fees. ...
- Extra Work. ...
- Fraud and Security.
iv) Debit card
sale
Advantages: 1.
Instent credits of fund in the account.
2. Saving in time
3. Easier way to pay
Disadvantages:
1. annual fee/ charges
2. fraud and srcurity problems
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Problem 7-4A Credit card and debit card transactions LO5 Help Me
SOLVE IT On September 5,...
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Problem 7-4A Credit card and debit card transactions LO5 On September 5, Maria Smith, owner of Super Gym Personal Service, provided personal training services to customers for cash of $3,500. Services of $9,000 were billed to corporate clients, terms 2/10, n/30. In the gym Maria uses a Square card reader that attaches to her iPhone, and other services totalling $18,000 were recorded on September 20 for customers using MasterCard (assume a 3.25% fee). On September 25, sales of $7,000 were...
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(Kindly do it without Debit or Credit column. The necessary columns
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Ford Motor Co. reports the following information from the Risk
Factors and the Management Discussion
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Credit Ratings Our short-term and long-term debt is rated by
four credit rating agencies designated
as nationally recognized statistical rating organizations
(“NRSROs”) by the?U.S. Securities
and Exchange Commission:
• DBRS Limited (“DBRS”);
• Fitch, Inc. (“Fitch”);
• Moody’s Investors Service, Inc....
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