Question
In: Accounting
a. Sold $852,000 of merchandise on account, subject to a sales tax of 7%. The cost of the goods sold was $502,680.
Sales Tax Transactions
Journalize the entries to record the following selected transactions.
a. Sold $852,000 of merchandise on account, subject to a sales tax of 7%. The cost of the goods sold was $502,680.
If an amount box does not require an entry, leave it blank.
| Accounts Receivable | |||
| Sales | |||
| Sales Tax Payable | |||
| Cost of Goods Sold | |||
| Inventory |
b. Paid $45,520 to the state sales tax department for taxes collected.
If an amount box does not require an entry, leave it blank.
| Sales Tax Payable | |||
| Cash |
Solutions
Expert Solution
- [a]
|
Accounts title |
Debit |
Credit |
|
Accounts Receivable |
$911,640 |
|
|
Sales |
$852,000 |
|
|
Sales Tax Payable [$852000 x 7%] |
$59,640 |
|
|
Cost of Goods Sold |
$502,680 |
|
|
Inventory |
$502,680 |
- [b]
|
Accounts title |
Debit |
Credit |
|
Sales tax Payable |
$59,640 |
|
|
Cash |
$59,640 |
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