Ask Question
11 November, 04:50

1. Carla Vista Co. enters sales and sales taxes separately on its cash register. On April 10, the register totals are sales $26,500 and sales taxes $1,325. 2. Wildhorse Co. does not segregate sales and sales taxes. Its register total for April 15 is $18,550, which includes a 6% sales tax. Prepare the entries to record the sales transactions and related taxes for Carla Vista Co. Prepare the entries to record the sales transactions and related taxes for Wildhorse Co.

+1
Answers (1)
  1. 11 November, 05:43
    0
    April 10: Carla Vista Co.

    Debit Cash $27,825.2

    Credit Sales revenue $26,500

    Credit Sales tax payable $1,325. 2

    (To record sales transactions and related tax)

    April 15: Wildhorse Co.

    Debit Cash $18,550

    Credit Sales revenue $17,500

    Credit Sales tax payable $1,050

    (To record sales transactions and related tax)

    Explanation:

    The sales tax is a certain percentage of the sales revenue. The tax is meant to be remitted to the government before a certain deadline based on the tax jurisdiction.

    On Wildhorse Co., the sales tax payable of 6% was calculated by:

    106% of Sales revenue = $18,550;

    106%X = $18,550

    X = Sales revenue = $18,550/106%

    Sales revenue = $17,500

    Sales tax payable = $18,550 - $17,500 = $1,050
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “1. Carla Vista Co. enters sales and sales taxes separately on its cash register. On April 10, the register totals are sales $26,500 and ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers