June 6 Service and installation work were completed on a customer\'s jet ski per
ID: 2557644 • Letter: J
Question
June 6
Service and installation work were completed on a customer's jet ski personal watercraft and the customer paid cash for the work completed. The sales invoice lists $156.00 for 2.4 hours of labor, $421.40 for accessories, and 8% sales tax on the total (labor and accessories).
Round all sales tax calculations to the nearest cent.
The stainless impeller being sold for $176.40 cost the business $88.20. The nozzel extension cost $122.50 and is being sold for $245.00. ALL accessories carry a 50% "normal" markup on selling price (100% markup on net cost).
*Enter the journal entry to record the sales transaction. How would you properly journalize this transaction based off of the provided information?
Stock Number Item Quantity Net Cost Per Unit C0400 STAINLESS IMP. 100 1 $88.20 KW003 NOZZEL EXTENSION 1 $122.50Explanation / Answer
Ans: Journal Entry
Cash A/c Dr 623.92
To SalesA/c 577.40
To Sales Tax LiabilityA/c 46.192
(Being Goods and Labour supplied in cash)
2) Trading and Profit & Loss A/c Dr 213.70
To Cost of Goods SoldA/c 213.70
(Being Cost of Good sold transfered to Profit & Loss A/c)
Note: Labour services provided also become the part of Revenue Turnover
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