Answer:
1. Record purchases on credit card as an Expense Transaction.
Dr. Gasoline expense
Cr. Credit Card payable
The Gasoline purchase is an expense so it is debited to an expense account. The purchase was paid for by the Credit Card which is a liability so it will be credited.
2. Reconcile the credit card account and enter a bill for payment later.
Dr. Credit Card Payable
Cr. Accounts Payable
As the credit Card is a liability it will need to be accounted for as an Accounts Payable.
3. Pay the credit card bill with a check
Dr. Accounts payable
Cr. Checking
When paying for the credit card bill, the Accounts payable will be debited to recognize the reduction in Accounts payable. The checking account is credited to recognize a reduction in money in the bank account.
