Question

Phone Retailer operates in a province where HST 14% is charged on all goods and services. During March 2020, it had the following transactions Mar 12 Sold inventory to a customer for $1.300 plus HST for cash. The inventory costs 5715. Mar 15 Sold inventory to a customer for $4800 plus HST on account. The inventory costs $2800 Record the transactions for March 2020. The company uses a perpetual inventory system Do not enter dollar signs or commes in the incut boxes Round all answers to the nearest whole dollar For transactions that have more than one debitor more than one credit enter the accountsinhabetical order Date Account Title and Explanation Debit Credit Mar 12 . To record cash sole Mar 12 To record COGS for the above sale Mar 15 . To record sale on account Mar 15 To record COGS for the above sole Type here to search

Answer 1

In the books of Phone Retailer

Journal Entries

Date	Account title & Explanation	Debit	Credit
12-Mar-20	Cash	$1,482
	Sales Revenue ( Note 1)		$1,300
	HST payable		$182
	( To record Cash Sales )
12-Mar-20	Cost of Goods sold	$715
	Inventory		$715
	( To record Cost of goods sold for above sale )
15-Mar-20	Accounts Receivable	$5,472
	Sales Revenue ( Note 1)		$4,800
	HST payable		$672
	( To record sale on account )
15-Mar-20	Cost of Goods sold	$2,800
	Inventory		$2,800
	( To record Cost of goods sold for above sale )

Note 1: It is assumed that the Cash Sale & Credit sale of $ 1,300 & $ 4,800 are excluding 14% HST payable.Hence, 14% HST is collected extra from customer.

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