Z-Mart uses the perpetual inventory system and allows customers to use the Z-Mart store credit card in charging purchases. Z-Mart assesses a per-month interest fee for any unpaid balance on its store credit card at each month-end. Apr. 30 Z-Mart sold merchandise for $1,000 (that had cost $650) and accepted the customer's Z-Mart store credit card. May 31 Z-Mart recorded $4 of interest earned from its store credit card as of this month-end. Prepare journal entries to record the above selected credit card transactions of Z-Mart.

Question

Business

Frankie Fritz

15 December, 02:29

Z-Mart uses the perpetual inventory system and allows customers to use the Z-Mart store credit card in charging purchases. Z-Mart assesses a per-month interest fee for any unpaid balance on its store credit card at each month-end. Apr. 30 Z-Mart sold merchandise for $1,000 (that had cost $650) and accepted the customer's Z-Mart store credit card. May 31 Z-Mart recorded $4 of interest earned from its store credit card as of this month-end. Prepare journal entries to record the above selected credit card transactions of Z-Mart.

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Answers (1)

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Moshe Moyer · Answer 1

Following are the journal entries

Explanation:

Z-mart uses perpetual inventory system. To enter the selected credit card transactions, the journal entries are;

No Date General Journal Debit Credit

1 Apr 30 Accounts receivable 1000

Sales 1000

2 Apr 30 Cost of goods sold 650

Merchandise inventory 650

3 May 31 Accounts receivable 4

Interest revenue 4