Problem 7.6A. Unmatched Elegance GiftShop sells cards, supplies, and various holiday greeting cards.Sales to retail customers are subject to an 8 percent sales tax.The firm sells it merchandise for cash; to customers using bankcredit cards, such as MasterCard and VISA; and to customers usingAmerican Express. The bank credit cards charge a 2 percent fee.American Express charges a 3 percent fee. Unmatched Elegance GiftShop also grants trade discounts to certain wholesale customers whoplace large orders. These orders are not subject to sales tax.During February 2016, Unmatched Elegance Gift Shop engaged in thefollowing transactions:

Date	Transactions
2016
Feb 1	Sold crystal goods to Beautiful Kitchens, a wholesalecustomer. The list price is $5,000, with a 30 percent tradediscount. This sale is not subject to sales tax. Issued Invoice5950 with terms of n/15.
Feb 15	Recorded cash sales for the period from February 1 toFebruary 15 of $9,500 plus sales tax of $760.
Feb 15	Recorded sales for the period from February 1 toFebruary 15 to customers using bank credit cards of $13,000 plussales tax of $1,040. (Record the 2 percent credit card expense atthis time.)
Feb 16	Received a check from Beautiful Kitchens in payment ofInvoice 5950 dated February 1.
Feb 16	Sold merchandise to customers using American Express for$9,000 plus sales tax of $720.
Feb 17	Sol a set of Roman statues to Incredible Bedrooms, awholesale customer. The list price is $9,000, with a 20 percenttrade discount. This sale is not subject to sales tax. IssuedInvoice 5951 with terms of n/15.
Feb 20	Received payment from American Express for amount billedon February 16, less a 3 percent credit card expense.
Feb 27	Received a check from Incredible Bedrooms in payment ofInvoice 5951 dated February 17.
Feb 28	Recorded cash sales for the period of February 16 toFebruary 28 of $7,750 plus sales tax of $620.
Feb 28	Recorded sales for the period from February 16 toFebruary 28 to customers using bank credit cards of $15,000 plustax of $1,200. (Record the 2 percent credit card expense at thistime.)
Feb 28	Sold merchandise to customers using American Express for$10,200 plus sales tax of $816.

Instructions

1. Open the general ledger accounts indicated below andenter the balances a of February 1, 2016.
2. Record the transactions in a general journal. Use 10 asthe journal page number.
3. Post the entries from the general journal to theappropriate accounts in the general ledger.

General Ledger Accounts

101                 Cash, $23,230 Dr.                           401                 Sales

121                 AccountsReceivable                       521                 Credit Card Expense

222                 Sales Tax Payable

Analyze: What was the total credit card expense incurredin February?