(Adjusting Entry for Sales Tax and VAT) Eastwood Ranchers sells a herd of cattle to Rozo Meat Packers for €30,000 and the related VAT. Rozo Meat Packers sells the beef to Wrangler Supermarkets for €40,000 and the related VAT. Wrangler Supermarkets sells this beef to customers for €50,000 plus related VAT. Instructions a. Assuming the VAT is 15% on all sales, prepare the journal entry to record the sale by Rozo Meat Packers to Wrangler Supermarkets. b. What is the net cash outlay that Eastwood Ranchers incurs related to the VAT?
(Adjusting Entry for Sales Tax and VAT) Eastwood Ranchers sells a herd of cattle to Rozo Meat Packers for €30,000 and the related VAT. Rozo Meat Packers sells the beef to Wrangler Supermarkets for €40,000 and the related VAT. Wrangler Supermarkets sells this beef to customers for €50,000 plus related VAT. Instructions a. Assuming the VAT is 15% on all sales, prepare the journal entry to record the sale by Rozo Meat Packers to Wrangler Supermarkets. b. What is the net cash outlay that Eastwood Ranchers incurs related to the VAT?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:(Adjusting Entry for Sales Tax and VAT) Eastwood Ranchers sells a herd of cattle to Rozo Meat
Packers for €30,000 and the related VAT. Rozo Meat Packers sells the beef to Wrangler
Supermarkets for €40,000 and the related VAT. Wrangler Supermarkets sells this beef to
customers for €50,000 plus related VAT.
Instructions
a. Assuming the VAT is 15% on all sales, prepare the journal entry to record the sale by Rozo
Meat Packers to Wrangler Supermarkets.
b. What is the net cash outlay that Eastwood Ranchers incurs related to the VAT?
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