Question

Sales revenue for a sporting goods store amounted to $ 535 comma 000 for the current period. All sales are on account and are subject to a sales tax of 11​%. Which of the following would be included in the journal entry to record the sales​ transaction?

Answer 1

Step-by-step explanation:

The journal entry is shown below:

Account receivable A/c Dr $593,850

To Sales tax payable A/c $58,850 ($535,000 × 11%)

To Sales revenue A/c $535,000

(Being sale is made on credit)

The account receivable amount includes both the sales tax payable and the sales revenue amount.