Schofield Retailers accepted $60,000 of Silver Bank MasterCard credit card charges for merchandise sold on August 1. Silver Bank charges 4% for its credit card use. The entry to record this transaction by Schofield Retailers will include a credit to Sales Revenue of $60,000 and a debit(s) to
A) Cash for $57,600 and Service Charge Expense for $2,400.
B) Accounts receivable for $57,600 and Service Charge Expense for $2,400.
C) Cash for $60,000.
D) Accounts Receivable for $60,000.

Question

Quizplus · Accepted Answer

Schofield Retailers will receive $57,600 in cash after the 4% service charge ($2,400) is deducted by Silver Bank. Therefore, the entry will debit Cash for $57,600 and Service Charge Expense for $2,400.

Schofield Retailers Accepted $60,000 of Silver Bank MasterCard Credit Card