Essay
Your friend, Malaya Claire, recently opened a retail shoe store. She knows she needs to pay sales tax but isn't sure how much. The GST and PST are calculated by the cash register. The GST rate is 5% and the PST rate is 8%. Sales, before taxes, for the first month of operations based on the cash register reports were $125,000. All sales are for cash, debit card, or bank credit card. Cost of goods sold is 50% of sales and a perpetual inventory system is used.Instructions
a. Calculate the amount of GST and PST.
b. Prepare the journal entry to record the sales and sales taxes, and cost of goods sold.
Correct Answer:
Verified
Correct Answer:
Verified
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