During the month of June, Rowling Boutique had cash sales of$233,200 and credit sales of $153,700, both of which include the 6%sales tax that must be remitted to the state by July 15.

Instructions

Prepare the adjusting entry that should be recorded to fairlypresent the June 30 financial statements.

Question

Business

Kidd

29 May, 09:30

During the month of June, Rowling Boutique had cash sales of$233,200 and credit sales of $153,700, both of which include the 6%sales tax that must be remitted to the state by July 15.

Instructions

Prepare the adjusting entry that should be recorded to fairlypresent the June 30 financial statements.

+3

Answers (1)

Know the Answer?

Kaitlynn · Answer 1

Cash sales = $233,200 * (100 : 106)

= $220,000

Credit sales = $153,700 * (100 : 106)

= $145,000

Sales tax revenue = ($220,000 + $145,000) * 6%

= $21,900

Therefore, the Journal is as follows:

Sales tax revenue A/c Dr. $21,900

To sales tax payable $21,900

(To record the sales tax payable)

During the month of June, Rowling Boutique had cash sales of$233,200 and credit sales of $153,700, both of which include the 6%sales tax that must be remitted to the state by July 15.InstructionsPrepare the adjusting entry that should be recorded to fairlypresent the June 30 financial statements.