Question

Glebe Company accepted a credit card account receivable in exchange for $1,100 of services provided to a customer. The credit card company charges a 5% service charge. The collection of cash from the credit card company when it settles the account receivable balance will act to:

Answer 1

Account receivable balance = $1,100 - ($1,100* 5%)

Account receivable balance =$1,100 - $55

Account receivable balance = $1,045

Date Account Title Debit Credit

Cash Account $1,045

To Accounts receivable $1,045