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4 January, 01:29

Sales Tax Cobb Baseball Bats sold 45 bats for $50 each, plus an additional state sales tax of 6%. The customer paid cash. Required: Prepare the journal entry to record the sale. If an amount box does not require an entry, leave it blank. a. blank.

b. Cash

c. Sales

d. Revenue Sales

e. Tax Payable

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  1. 4 January, 03:24
    0
    Cobb Baseball

    Journal Entry

    Sr No Particulars Debit Credit

    Cash 2385Dr

    Sales 2250Cr

    Tax Payable 135Cr

    Explanation:

    45 bats for $ 50 = 45*50 = 2250

    Tax = 6 %of 2250 = $135

    total cash received = $2250 + 135 = $2385

    The tax payable is the liability of the company to pay tax. The sales are made of $ 2250 and the cash received is $ 2385 including the tax of 6 %.

    Usually the sales tax is included in the sales price of an item. But some companies collect it separately and treat it in a separate account.
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