Asked by Demario Green on Jul 30, 2024
Verified
Merchandise is sold for cash. The selling price of the merchandise is $6,000 and the sale is subject to a 7% state sales tax. The journal entry to record the sale would include a credit to
A) Cash for $6,000
B) Sales for $6,420
C) Sales Tax Payable for $420
D) Sales for $5,580
State Sales Tax
A tax imposed by a state on sales of goods and services, typically calculated as a percentage of the sale price.
Selling Price
The amount of money charged for a product or service, ultimately determining the revenue generated from sales.
- Document the accounting entries for merchandise sales, incorporating cases that involve sales tax.
Verified Answer
ZK
Zybrea KnightAug 04, 2024
Final Answer :
C
Explanation :
Sales tax payable = Selling price × 7% state sales tax = $6,000 × 7% = $420
The journal entry to record the sale would include a credit to Sales Tax Payable for $420.?
Sales tax payable = Selling price × 7% state sales tax = $6,000 × 7% = $420
The journal entry to record the sale would include a credit to Sales Tax Payable for $420.?
Learning Objectives
- Document the accounting entries for merchandise sales, incorporating cases that involve sales tax.
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