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During December, Rainey Equipment made a $658,000 credit sale. The state sales tax rate is 6% and the local sales tax rate is 1.5%. Prepare the appropriate journal entry. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Respuesta :

So starting out they purchase your equipment with a promissory note. That promissory note is Debited to your accounts receivable for the amount of sales price (658,000) + both sales & local taxes. 6%+1.5%= 7.5% so... 1+ (7.5%*658,000)=  $707,350

then your sales tax payable is credited like this 7.5%*658,000= $49,350

and of course credit, the sales price for $658,000

Explanation:

Accounts Receivable                   $707,350

Sales Revenue                            $658,000  

            Sales taxes payable                         $49,350

Good luck!

#JmackTheInstructor

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