an online retailer selling tennis supplies. HST is calculated by the web software for every sale at a rate of 13%. Sales (before tax) for the last month was $125,000. All sales are on debit card or bank credit card. Cost of goods sold is 75% of sales and a perpetual inventory system is used. This information needs to be entered into the accounting system. Instructions (a) Calculate the amount of HST. (b) Prepare the journal entry to record the sales, sales taxes, and cost of goods sold. (c) Record the journal entry to record sending the collected HST to the government.
an online retailer selling tennis supplies. HST is calculated by the web software for every sale at a rate of 13%. Sales (before tax) for the last month was $125,000. All sales are on debit card or bank credit card. Cost of goods sold is 75% of sales and a perpetual inventory system is used. This information needs to be entered into the accounting system. Instructions (a) Calculate the amount of HST. (b) Prepare the journal entry to record the sales, sales taxes, and cost of goods sold. (c) Record the journal entry to record sending the collected HST to the government.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
an online retailer selling tennis supplies. HST is calculated by the web software for every sale at a rate of 13%. Sales (before tax) for the last month was $125,000. All sales are on debit card or bank credit card. Cost of goods sold is 75% of sales and a perpetual inventory system is used. This information needs to be entered into the accounting system.
Instructions
(a) Calculate the amount of HST.
(b) Prepare the
(c) Record the journal entry to record sending the collected HST to the government.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps with 3 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education