Question

Record the entries for the merchandise sold on March 25 if a 4% sales tax rate applies. Record the sales revenue of $2990 on account to wildcat services together with 4% sales tax on every dollar of merchandise sold.

Answer 1

Date	General Journal	Debit	Credit
25-Mar	Accounts Receivables	$ 3,109.60
	Sales Revenue		$    2,990.00
	Sales tax payable		$    119.60
	( To record sales revenue and sales tax payable)

Sales tax =$2990 x 4%=119.60

Sales tax payable is a current liability for the seller.

Sales tax will be deposited by seller to the govt at due date.

Note---Accounts title may vary.