Which of the following represents the impact of a taxable cash sale of $1,080 on

ID: 2522712 • Letter: W

Question

Which of the following represents the impact of a taxable cash sale of $1,080 on the accounting equation if the sales tax rate is 5%?

An increase to cash for $1,134, an increase to sales tax expense for $54, and an increase to sales revenue for $1,080.

An increase to cash for $1,134, an increase to sales tax payable for $54, and an increase to sales revenue for $1,080.

None of these answer choices is correct.

An increase to cash for $1,080, an increase to sales tax payable for $54, and an increase to sales revenue for $1,026.

Journal entry :

so answer is b) An increase to cash for $1,134, an increase to sales tax payable for $54, and an increase to sales revenue for $1,080.

Date accounts & explantion debit credit Cash 1134 Sales revenue 1080 Sales tax payable 54

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