Question

Dextra Computing sells merchandise for $4,000 cash on September 30 (cost of merchandise is $2,800). The sales tax law requires Dextra to collect 6% sales tax on every dollar of merchandise sold. Record the entry for the $4,000 sale and its applicable sales tax. Also record the entry that shows the payment of the 6% tax on this sale to the state government on October 15.

Answer 1

Journal entry

Date	account and explanation	Debit	Credit
Sep 30	Cash (4000*1.06)	4240
	Sales revenue		4000
	Sales tax payable		240
	(To record sales)
	Cost of goods sold	2800
	Merchandise inventory		2800
	(To record cost of goods sold)
Oct 15	Sales tax payable	240
	Cash		240
	(To record sales tax paid)