Register
Peterson Company billed its customers a total of $840,000 for the month of November. The total includes a 5% state sales tax. (a) Determine the proper amount of revenue to report for the month. (b) Prepare
493,524 views
7 votes
7 votes
Peterson Company billed its customers a total of $840,000 for the month of November. The total includes a 5% state sales tax.

(a) Determine the proper amount of revenue to report for the month.
(b) Prepare the general journal entry to record the revenue and related liabilities for the month.

User Rosy
by
2.8k points

1 Answer

20 votes
20 votes

Answer:

a. $800000

b. Account receivable Dr. 840000

To sales revenue 800000

To sales tax payable 40000

Step-by-step explanation:

a. Given the total billed amount = $840000

Sales tax = 5%

Total revenue for the month = 840000 x (100 / 105) = $800000

b. Account receivable Dr. 840000

To sales revenue 800000

To sales tax payable 40000

User David Drever
by
3.1k points
Ask a Question
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

1.6m questions

2.0m answers

Other Questions

If the rate of inflation in Japan dramatically increases while the rate of inflation in the United States remains constant, then a. the demand curve for dollars shifts to the left. b. the demand curve
Kylie is risk averse and has $1,000 with which to make a financial investment. She has three options. Option A is a risk-free government bond that pays 5 percent interest each year for two years. Option
Elroy Rocket is entering his senior year as an accounting major and has a number of options for his summer break. His options for the 3 month break follow: (1) Work full time at a local accounting firm
In January of the current year, Dora made a gift of stock to her granddaughter. At the time of the gift, the stock was worth $15,000. Several months later in the same year after the gift, a $500 dividend
Jillian Diaz receives a regular salary of $1,500 a month and is entitled to overtime pay at the rate of one and one-half times the regular hourly rate for any time worked in excess of 40 hours per week.
Link Copied!