The College Store Accepts MasterCard for Payments of Purchases Made

question 63

Multiple Choice

The College Store accepts MasterCard for payments of purchases made by students. The credit card drafts are deposited directly in a bank account. MasterCard charges a 1.55% collection fee. Credit card drafts totaling $10,000 are deposited during August. Recording the sales and deposits will result in an increase in

• A)Cash for $10,000
• B)Sales for $ 9,854
• C)Accounts Receivable for $9,854
• D)Service Charge Expense for $155

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Definitions:

Indirect Business Taxes

Taxes imposed on goods and services that indirectly affect companies, such as sales tax or value-added tax.

Depreciation

The reduction in the value of an asset over time, often due to wear and tear or obsolescence.

Net Domestic Product

The total value of all goods and services produced within a country in a specific period, minus depreciation.

Depreciation

The process of allocating the cost of a tangible asset over its useful life, reflecting a decrease in its value over time.