When the Credit Card Processor Deposits the Gross Proceeds from Credit

question 44

Multiple Choice

When the credit card processor deposits the gross proceeds from credit and debit card sales ________.

• A)there will be no fee charged for the transaction
• B)the deposit is made on the last day of the month
• C)the total sales less the processing fee assessed equals the net amount of cash deposited
• D)the processing fees are deducted from the company's bank account by the processor

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Definitions:

Investing Activities

Refers to the acquisition and disposition of long-term assets and other investments not included in cash equivalents.

Free Cash Flow

The amount of operating cash flow available to a company after it purchases the property, plant, and equipment necessary to maintain its current operations, computed as cash flows from operating activities less cash used to purchase property, plant, and equipment.

Operating Cash Flow

Cash generated from the core business operations of a company, excluding financing and investment activities.

Direct Method

In cash flow reporting, it involves directly identifying and reporting major classes of gross cash receipts and payments.