if your customer has paid you through credit card. Sales Discounts The account used to record the reduction given to customers for prompt payments. What is the journal entry to record the receipt of payment on June 15th for the following: June 1st, merchandise sold on account in the amount of $525, credit terms 1/10, n/30. Credit Card Payable is a liability account on your balance sheet because you owe this money. To Bank A/c . A company may have a limited time to dispute transactions with a merchant services provider, so speed and accuracy are paramount in this process. Sold $5,000 of merchandise, which cost $3,000, on an assortment of bank credit cards. MasterCard charges a 5% fee. 1. A Journal Entry is simply a summary of the debits and credits of the transaction entry to the Journal. Credit Card (Bank Name) Payable A/c. Apple Inc is a dealer of laptop & Computers, and he is selling goods to John electronics on 01.01.2018 of $ 50000 on credit, and his credit period is 15 days, which means John Electronics has to make the payment on or before 30.01.2018. Journal entries are important because they allow us to sort our transactions into manageable data. Example of Recording Credit Card … Record the payment to the credit card company as a decrease to the bank account used for payment and a decrease to the Credit Card Payable account. (It may be called something different, like the name of the card, i.e. Credit Card expenses are common now days in fact, it is a kind of credit facilities and does not differ in accounting treatment. American Express) When you make the payment of the credit card, the general journal entry would look like this: These cards charge a 4% fee. When the customer pays the bill, you update the individual customer’s record to show that payment has been received and enter the following into the bookkeeping records: Goods bought on credit from the supplier in the same way, Credit Card expenses is accounted into books of accounts This post will explain you how to book Credit Card expenses in accounts and in Tally.erp 9 Credit Card expenses | basic understanding Prepare journal entries for the following credit card sales transactions (the company uses the perpetual inventory system). This may involve disputing transactions with the credit card processor, making journal entries to correct timing items or errors, or other actions to address transaction issues. Match the credit card statement, when received, to the recorded receipts to ensure all the amounts were correctly posted by the credit card company. In addition to making this journal entry, you enter the information into the customer’s account so that accurate bills can be sent out at the end of the month. Journal entry for removing money from the petty cash fund You (or your petty cash cashier) must also create journal entries showing what petty cash funds go toward. The company's payment to the credit card company will result in a credit to the company's Cash account. and when you receive credit in your bank account then. Since Money is coming in bank account, its Debit. Bank Account Debit To Dividend Received Bank Account Debit: Rule: Debit what comes in, credit what goes out. Credit Card (Bank) A/c Dr. To Sales A/c . You’ll notice the above diagram shows the first step as “Source Documents”. And finally when you pay to your bank the credit card payment. To Credit Card (Bank Name) Payable A/c . Consider the following diagram . Sold $20,000 of merchandise, which cost $15,000, on MasterCard credit cards. 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