Question

• Part one (Sales taxes Payable)
• Record the cash sale of merchandise on September 30^th. The merchandise was sold for $12,000 and had a cost of $7,000. (You may ignore the cost information if we have not yet covered cost of goods sold in the course.) Tax rate is 5%.
• Record the remittance of the sales taxes to the state on October 30^th.

Answer 1

Solution:

Journal Entries
Date	Particulars	Debit	Credit
30-Sep	Cash Dr	$12,600.00
	To Sales revenue		$12,000.00
	To Sales tax payable		$600.00
	(To record sales)
30-Oct	Sales tax payable Dr	$600.00
	To Cash		$600.00
	(To record payment of sales tax)