G Elliston Company accepted credit card payments for $10,000 of services provided to customers. The credit card company charges a 3% fee for handling the transaction. Which of the following describes the effect of this transaction:

A. increase revenue by $9,700.

B. increase assets by $10,000.

C. increase Retained Earnings by $9, 700.

D. increase net income by $10,000.

Question

Business

Vaughn

7 July, 17:58

G Elliston Company accepted credit card payments for $10,000 of services provided to customers. The credit card company charges a 3% fee for handling the transaction. Which of the following describes the effect of this transaction:

A. increase revenue by $9,700.

B. increase assets by $10,000.

C. increase Retained Earnings by $9, 700.

D. increase net income by $10,000.

+2

Answers (1)

Know the Answer?

Cohen Peters · Answer 1

C. increase Retained Earnings by $9, 700.

Explanation:

Since it is given that the service provided to customers for $10,000 and it is also not reflected the company income so it would be considered after deducting the 4% free from the total amount i. e

= $10,000 - $10,000 * 3%

= $10,000 - $300

= $9,700

Hence, the retained earning is increased by $9,700

Therefore, All other options are wrong