Journalize the entries to record the following selected transactions:

Sold $62,800 of merchandise on account, subject to a sales tax of 5%. The cost of the merchandise sold was $37,500.

Paid $39,650 to the state sales tax department for taxes collected

Question

Meghan Solomon

Business

21 July, 06:06

Journalize the entries to record the following selected transactions:

Sold $62,800 of merchandise on account, subject to a sales tax of 5%. The cost of the merchandise sold was $37,500.

Paid $39,650 to the state sales tax department for taxes collected

+1

Answers (1)

Know the Answer?

Jorden Hudson · Answer 1

General Ledger Dr. Cr.

1. Cash $65,940

Sales Tax Payable $3,140

Sales $62,800

2. Cost of Goods Sold $37,500

Merchandise Inventory $37,500

3. Sales Tax Payable $39,650

Cash $39,650

Explanation:

Sales tax is subject to 5% which is

Sales Tax = $62,800 x 5% = $3,140

Total Cash received = $62,800 + $3,140 = $65,940

Cost of the merchandise sold is recorded in the cost of goods sold account.

Tax is paid in cash and Tax payable liability is reduced by a debit entry.

Journalize the entries to record the following selected transactions:Sold $62,800 of merchandise on account, subject to a sales tax of 5%. The cost of the merchandise sold was $37,500.Paid $39,650 to the state sales tax department for taxes collected

Journalize the entries to record the following selected transactions:

Sold $62,800 of merchandise on account, subject to a sales tax of 5%. The cost of the merchandise sold was $37,500.

Paid $39,650 to the state sales tax department for taxes collected