Final answer:
Smart Touch Learning will record a journal entry with a debit to Cash for $525, a credit to Sales Revenue for $500, and a credit to Sales Tax Payable for $25 when selling the $500 tablet with a 5% sales tax.
Step-by-step explanation:
When Smart Touch Learning sells a $500 tablet for cash with a 5% sales tax rate, the company needs to record the revenue from the sale of the tablet as well as the sales tax liability. The total cash received will be the cost of the tablet plus the sales tax, which is calculated as 5% of $500, equalling $25.
Therefore, the total cash received is $525. The journal entry to record this sale would include a debit to Cash for $525, a credit to Sales Revenue for $500, and a credit to Sales Tax Payable for $25.