Sales Tax A sale of merchandise on account for $12,500 is subject to a 8% sales...

Sales Tax

A sale of merchandise on account for $12,500 is subject to a 8% sales tax.

(a) Should the sales tax be recorded at the time of sale or when payment is received?

(b) What is the amount credited to sales?
$

(c) What is the amount debited to Accounts Receivable?
$

(d) What is the account to which the $1,000.00 is credited?

Solutions

Expert Solution

Answer A) Sales tax should be recorded at the time of sales.

Answer B) $12,500

Answer C) $13,500 ($12,500 + $1000)

Answer D) Sales tax payable account.

ekkarill92 answered 2 years ago

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