Survey Of Accounting
4th Edition
ISBN: 9780077862374
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Question
Chapter 7, Problem 8Q
To determine
Identify whether the collection of sales tax from customer is a revenue or not to business.
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How is sales tax recorded? Is it considered an expense of a business? Why or why not?
A3
What is the formula for calculating sales tax?
A. Amount of Purchase x Sales Tax Rate = Sales Tax
B. Cost of Goods Sold x Sales Tax Rate = Sales Tax
C. Amount of Revenue x Sales Tax Rate = Sales Tax
Chapter 7 Solutions
Survey Of Accounting
Ch. 7 - 1. What type of transaction is a cash payment to...Ch. 7 - Prob. 2QCh. 7 - How does recording accrued interest affect the...Ch. 7 - 4. Who is the maker of a note payable?Ch. 7 - How does the going concern assumption discussed in...Ch. 7 - 6. Why is it necessary to make an adjusting entry...Ch. 7 - Prob. 7QCh. 7 - Prob. 8QCh. 7 - Prob. 9QCh. 7 - Prob. 10Q
Ch. 7 - 11. Are contingent liabilities recorded on a...Ch. 7 - Prob. 12QCh. 7 - Prob. 13QCh. 7 - Prob. 14QCh. 7 - Prob. 15QCh. 7 - Prob. 16QCh. 7 - 1. What is the difference between classification...Ch. 7 - 2. At the beginning of Year 1, B Co. has a note...Ch. 7 - 3. What is the purpose of a line of credit for a...Ch. 7 - 4. What are the primary sources of debt financing...Ch. 7 - 5. What are some advantages of issuing bonds...Ch. 7 - 6. What are some disadvantages of issuing bonds?Ch. 7 - 7. Why can a company usually issue bonds at a...Ch. 7 - 15. If Roc Co. issued 100,000 of 5 percent,...Ch. 7 - 16. What is the mechanism is used to adjust the...Ch. 7 - 17. When the effective interest rate is higher...Ch. 7 - 18. What type of transaction is the issuance of...Ch. 7 - 19. What factors may cause the effective interest...Ch. 7 - 20. If a bond is selling at 97, how much cash will...Ch. 7 - Prob. 30QCh. 7 - 22. Gay Co. has a balance m the Bonds Payable...Ch. 7 - Prob. 32QCh. 7 - Prob. 33QCh. 7 - Prob. 1ECh. 7 - Prob. 2ECh. 7 - Prob. 3ECh. 7 - Prob. 4ECh. 7 - Prob. 5ECh. 7 - Prob. 6ECh. 7 - Prob. 7ECh. 7 - Prob. 8ECh. 7 - Prob. 9ECh. 7 - Prob. 10ECh. 7 - Prob. 11ECh. 7 - Prob. 12ECh. 7 - Prob. 13ECh. 7 - Prob. 14ECh. 7 - Prob. 15ECh. 7 - Prob. 16ECh. 7 - Prob. 17ECh. 7 - Prob. 18ECh. 7 - Prob. 19ECh. 7 - Prob. 20ECh. 7 - Prob. 21ECh. 7 - Prob. 22ECh. 7 - Prob. 23ECh. 7 - Prob. 24ECh. 7 - Prob. 25ECh. 7 - Prob. 26PCh. 7 - Prob. 27PCh. 7 - Prob. 28PCh. 7 - Prob. 29PCh. 7 - Prob. 30PCh. 7 - Prob. 31PCh. 7 - Prob. 32PCh. 7 - Prob. 33PCh. 7 - Prob. 34PCh. 7 - Prob. 35PCh. 7 - Prob. 36PCh. 7 - Prob. 37PCh. 7 - Prob. 38PCh. 7 - Prob. 1ATCCh. 7 - Prob. 4ATCCh. 7 - Prob. 5ATC
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Similar questions
- 10. 11. 12 13 14. Which accounting method for depreciation would you use if you wanted your taxes to be the lowest: 15. A. B. C. D. A. B. C. D. In times of rising prices, which inventory method would you want to use if you were an CEO interested in issuing a new stock offer: ABCD 200% Double Declining Balance. MACRS A. Straight Line Depreciation. Sum of the years Digits. Which method is used to expense operating assets? Depletion Amortization C. Depreciation D. Write off method B. LIFO Average FIFO None of the above What is the LCM rule concerning the valuation of inventories. A. Last in cost rule. B. Lower of cost or MACRS C. A rule that requires a company to value its inventory at market value If its market price is lower than its cost. D. Can be used in place of FIFO. SHORT ESSAY Why is the perpetual inventory system superior to the periodic system for business purposes? What are the two allowance methods used to account for bad debts. Explain who would be most interested in each…arrow_forwardhow does taxes affect Businesses?arrow_forwardWhy company tax rate is always different from company accounting income?arrow_forward
- How does payments for tax and licenses affect accounting equation?arrow_forwardWhich of the following statements is true about sales tax? O a. Sales tax is collected by retailers from customers to be paid to tax authorities later. O b. Sales tax is recorded and paid by customers to tax authorities. O c. Sales tax is not required to be mentioned in the sales invoice prepared by a seller. O d. Sales tax is the amount of discount extended to customers by retailers to be disclosed to tax authorities.arrow_forwardHow could failing to collect sales tax result in a larger tax liability for a business than failing to pay income taxes?arrow_forward
- Which of the following accounts is credited by the seller when tax is collected on retail sales? A. Payroll Tax B. Unearned Revenue C. Accounts Payable D. Sales Tax Payablearrow_forwardProperty and income taxes are more popular than sales taxes and user charges? True or Falsearrow_forwardDiscuss how a sales tax is regressive.arrow_forward
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