Atlas Co. allows select customers to make purchases on credit. Its other custome

Question

Atlas Co. allows select customers to make purchases on credit. Its other customers can use either of two credit cards: Zisa or Access. Zisa deducts a 4.0% service charge for sales on its credit card and credits the bank account of Atlas immediately when credit card receipts are deposited. Atlas deposits the Zisa credit card receipts each business day. When customers use Access credit cards, Atlas accumulates the receipts for several days before submitting them to Access for payment. Access deducts a 3.0% service charge and usually pays within one week of being billed. Atlas completes the following transactions in June. (The terms of all credit sales are 2/15, n/30, and all sales are recorded at the gross price.) June 4 Sold $600 of merchandise (that had cost $240) on credit to Anne Cianci. 5 Sold $9,100 of merchandise (that had cost $3,640) to customers who used their Zisa cards. 6 Sold $5,944 of merchandise (that had cost $2,378) to customers who used their Access cards. 8 Sold $4,690 of merchandise (that had cost $1,876) to customers who used their Access cards. 10 Submitted Access card receipts accumulated since June 6 to the credit card company for payment. 13 Wrote off the account of Nakia Wells against the Allowance for Doubtful Accounts. The $648 balance in Wells

Explanation / Answer

Atlas Co. allows select customers to make purchases on credit. Its other customers can use either of two credit cards: Zisa or Access. Zisa deducts a 3% service charge for sales on its credit card and credits the bank account of Atlas immediately when credit card receipts are deposited. Atlas deposits the Zisa credit card receipts each business day. When customers use Access credit cards, Atlas accumulates the receipts for several days before submitting them to Access for payment. Access deducts a 2% service charge and usually pays within one week of being billed. Atlas completes the following transactions in June. (The terms of all credit sales are 2/15, n/30, and all sales are recorded at the gross price.)

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