Answer:
Step-by-step explanation:
The journal entries are shown below:
a. Account receivable A/c Dr $27,720
To Sales revenue A/c $26,400
To Sales tax payable A/c $1,320 ($26,400 × 5%)
(Being the credit sales is recorded)
b. Cash A/c Dr $27,195
To Sales revenue A/c $25,900 ($27,195 × 100 ÷ 105)
To Sales tax payable A/c $1,295
(Being cash sales is recorded and the remaining balance is credited to the sales tax payable account)