Regarding the gross method of handling credit and debit card transactions,which of the following statements is correct?
A) The total sale amount is deposited on the date of the actual sale.
B) The processing fees for all transactions processed for the month are deducted from the company's bank account, often on the last day of the month.
C) On the date of sale, the Sales Revenue account is credited for the amount of sale less the processing fee.
D) The journal entry on the date of sale is identical to a journal entry made for a sale on account.

Question

Quizplus · Accepted Answer

The gross method of handling credit and debit card transactions involves depositing the total sale amount on the date of the actual sale, and then deducting the processing fees for all transactions processed for the month from the company's bank account, often on the last day of the month. On the date of sale, the Sales Revenue account is credited for the full amount of the sale, and a separate account is created to track the processing fees. The journal entry for a sale on account would be different from the journal entry for a credit or debit card sale under the gross method.

Regarding the Gross Method of Handling Credit and Debit Card