Which of the following represents the impact of a taxable cash sale of $1,080 on the...
Which of the following represents the impact of a taxable cash sale of $1,080 on the accounting equation if the sales tax rate is 5%?
An increase to cash for $1,134, an increase to sales tax expense for $54, and an increase to sales revenue for $1,080.
An increase to cash for $1,134, an increase to sales tax payable for $54, and an increase to sales revenue for $1,080.
None of these answer choices is correct.
An increase to cash for $1,080, an increase to sales tax payable for $54, and an increase to sales revenue for $1,026.
Homework Answers
Journal entry :
| Date | accounts & explantion | debit | credit |
| Cash | 1134 | ||
| Sales revenue | 1080 | ||
| Sales tax payable | 54 | ||
so answer is b) An increase to cash for $1,134, an increase to sales tax payable for $54, and an increase to sales revenue for $1,080.
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