The Griffin Corporation accepted a credit card for a sale of $3,000 on December 16, Year 1. The credit card company charges a fee of 4%. On January 5, Year 2, Griffin received payment from the credit card company. Indicate whether each of the following statements is true or false.
_____ a) Griffin should record $2,880 revenue in Year 1 when the sale is made.
_____ b) Griffin should record a credit card receivable account receivable of $3,000 on December 16, Year 1.
_____ c) The sale has no impact on the statement of cash flows in Year 1.
_____ d) The collection of cash increases total assets in Year 2.
_____ e) The entry on December 16, Year 1, increases total revenues and total expenses on the Year 1 income statement.

Question

Quizplus · Accepted Answer

The Answer of The Griffin Corporation accepted a credit card for a sale of $3,000 on December 16, Year 1. The credit card company charges a fee of 4%. On January 5, Year 2, Griffin received payment from the credit card company. Indicate whether each of the following statements is true or false.
_____ a) Griffin should record $2,880 revenue in Year 1 when the sale is made.
_____ b) Griffin should record a credit card receivable account receivable of $3,000 on December 16, Year 1.
_____ c) The sale has no impact on the statement of cash flows in Year 1.
_____ d) The collection of cash increases total assets in Year 2.
_____ e) The entry on December 16, Year 1, increases total revenues and total expenses on the Year 1 income statement.

The Griffin Corporation Accepted a Credit Card for a Sale