Dextra Computing sells merchandise for $16,000 cash on September 30 (cost of merchandise is $11,200). Dextra collects 10% sales tax. Record the entry for the $16,000 sale and its sales tax. Also record the entry that shows Dextra sending the sales tax on this sale to the government on October 15.

See explanation section.

Explanation:

September 30, Cash Debit        = 17,600

Sales                           Credit       = 16,000

Sales taxes payable   Credit       = 1,600

Calculation: Sales taxes payable = 16,000 × 10% = 1,600

To record the sales by cash with a sales tax.

September 30, Cost of goods sold      Debit  = 11,200

Merchandise inventory                         Credit = 11,200

As the company uses perpetual inventory system, therefore,the company gave cost of goods sold journal.

October 15, Sales taxes payable          Debit  = 1,600

Cash                                                        Credit = 1,600

To record the cash payment of sales tax to government.

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