Final answer:
Payment with a credit card involves a short-term loan from the credit card company to the seller, and the receivables account is credited when the customer settles their credit card bill, not immediately after the transaction.
Step-by-step explanation:
The question refers to the accounting process involved in credit card transactions. When a payment is made using a credit card, it does not immediately credit the receivables account. Instead, the credit card acts as a short-term loan, which initially transfers money from the credit card company's checking account to the seller. The receivables account will only be credited when the actual payment is received from the credit card user, which is typically at the end of the billing cycle.
Credit card transactions and the resulting financial activities involve several steps before a receivables account is involved. To clarify, the receivables account in a company's ledger will reflect amounts that are owed to the company by its customers. Until the customer settles their credit card bill, the amount is owed by the customer to the credit card company, not to the merchant's receivable accounts.