Sure Mithas Travel is a travel agency with our head office based in Durban. The company earns commission on all its sales and has a sales, cost of sales and GP income statement format. The following are a few scenarios we would like you to answer.

Mr Smith has booked a vacation at Sun City with one of our consultants. The vacation costs R The commission earned on the vacation by our company is R Mr Smith chooses to use his credit card to pay for the vacation. The consultant provides the card details to Sun City Hotel to pay for the full cost of the vacation which includes the commission. Ignoring the effects of VAT, what balance sheet and income statement accounts will be debited and credited and why?

Answer rating: 100% (QA)

In this scenario when Mr Smith books a vacation at Sun City through Mithas Travel and chooses to pay ... View the full answer