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25 February, 07:19

A sales associate is preparing a seller's net statement. She estimates a closing date of June 26. Taxes are estimated at $4,360 and interest for June is $3,540. If she rounds to the nearest $100, which entries should she make on the statement?

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  1. 25 February, 09:19
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    Debit the profit and loss account by $7600 and credit taxes by $4,360 and also credit Interest account by $3,540

    Explanation:

    Here, a sales associate prepares sellers net statement., even it is a estimated statement., but the date on June 26 it is a current statement

    Accounting statement on June 26

    Profit and loss account $7600 (debit)

    To Taxes $4,360 (credit)

    To Interest $3,540 (credit)

    (being the amount allotted for Taxes and Interest)

    Note:

    Hence., the total of taxes and interest itself appears as a rounded one., so we need not make the amount to the nearest $100.
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