Banking

Credit Card Purchase — Billed to Cardholder

A cardholder's purchases during the billing cycle are posted to their card account.

Account NameTypeDebit ($)Credit ($)
Credit Card ReceivablesAsset (+)350.00-
Credit Card Commitments (Drawn)Contingent Liability (-)350.00-

💡 Accountant's Note

When a cardholder makes a purchase, the undrawn limit decreases and an on-balance-sheet receivable is created. The bank has funded the merchant through the card scheme settlement.

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