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Accounting Help! Please!?
A sale of merchandise on account for $12,200 is subject to a 6% sales tax.
(a) Should the sales tax be recorded at the time of sale or when payment is received?
(b) What is the amount of the sale?
$
(c) What is the amount debited to Accounts Receivable?
$
It's hard :(
1 Answer
- rehman vohraLv 61 decade agoFavorite Answer
(a) At the time of sale
(b) $12,200 representing sale value of goods
(c) $12,932 ($12,200 + Sales tax 732)
The entry will be:
Debit Accounts receivable 12,932
Credit Sales 12,200
Credit Sales Tax 732
Sales tax collected can be adjusted against sales tax paid on purchases
