Question

ACC 104 ACISH EXAM CHAPTER 9 3. (10 Points) Feathers Company sells merchandise for $24,000 cash on March 31 (cost of merchandise is $12,300). The sales tax law requires Feathers to collect 8.5% sales tax on dollar of merchandise sold. Record the entry for the sale and its applicable sales tax.(Assume the company uses the perpetual inventory method to keep track of inventory) every DATE DEBIT CREDIT

Answer 1

Date	Account Titles and Explanation	Debit	Credit
31-Mar	Cash	$ 26,040.00
	Sales revenue		$ 24,000.00
	Sales tax payable		$    2,040.00*
	(To record sales revenue and collection of sales tax)
31-Mar	Cost of goods sold	$ 12,300.00
	Merchandise Inventory		$ 12,300.00
	(To record Cost of goods sold)

*$24000 x 8.5%