When a business is able to deposit its credit card sales invoices directly into a special bank account,it debits Accounts Receivable.

Question

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When a business is able to deposit its credit card sales invoices directly into a special bank account, it does not debit Accounts Receivable. Instead, it credits Sales or Cash and debits the bank account where the funds were deposited. This is because the credit card company is paying the business directly, rather than the customer paying the business and owing a debt, which is what Accounts Receivable represents.

When a Business Is Able to Deposit Its Credit Card