Question

In performing accounting services for small businesses, you encounter the following situations pertaining to cash sales. 1. Pharoah Company enters sales and sales taxes separately on its cash register. On April 10, the register totals are sales $25,000 and sales taxes $1.250. 2. Cullumber Company does not segregate sales and sales taxes. Its register total for April 15 is $16,960, which includes a 6% sales tax. Prepare the entry to record the sales transactions and related taxes for Pharoah Company. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Apr. 10

Answer 1

Answer
Date	Account	Debit	Credit
Apr-10	Cash	$     26,250
	Sales revenue		$     25,000
	Sales tax payable		$       1,250
	( To Record the sales)
Apr-15	Cash	$     16,960
	Sales revenue (16,960*100/106)		$     16,000
	Sales tax payable (16000*6%)		$          960
	(To record segregate sales and taxes )

Answer 2

Sales revenue (16,960*100/106) why we add 100 in 6 plz explain