VOCAB.
- Sales tax is a tax on a sale of merchandise or services.
- Cash sale when cash is paid for the total ammount of the goods at the time of the purchase.
- Credit card sale when a credit card is used to pay for the goods
BASIC INFO
The amount of sales tax collected in a business is a liability untill it is paid off to the government. Therefore sales tax is recorded in a seperate account called Sales Tax payable. This account has acredit normal balance. In order to find the sales tax u have to multiuply the price of the goods by the sales tax rate. When ruling an extended journal you would take the same steps as you did with an 8 column journal.
paper tape is the recipt for a customer who paid with a credit card.
- Accounts receivable has a normal balance of a debit
- Sales has a normal balance of credit
- sales tax payable has a normal balance of a credit
Proving and ruling an expanded journal
When carring totals forward:
- Single rule
- wirte the date in the date column
- write carried forward in the account title column
- put a check mark in the post reference column
- write the totals for each column below below the single line
- double rule if all credits equal all debits if they don't equal CHECK YOUR MATH
When bringing totals forward
- write the page # @ the top of both pages
- write the date in the date column
- write "carried forward" on the account title column
- put a check mark in the post reference column
ruling an expanded journal is done in the same way that a regular journal is.
- single rule
- add up all the credits
- add up all the debits
- double rule if the credits and debits equal if not CHECK YOUR MATH
2 comments:
Very good summary on Ch.11. Nice layout and color choice. We will engage in math activities for this chapter, since we must learn how to apply sales tax.
A few tips for Ruling an Expanded Journal to Carry Totals Forward:
1. Rule a single line across all amount coulmns directly below the last entry to indicate that all the columns are to be added (left and right pages)
2. On the next line write the date in the date coulmn (left page)
3. Write the words Carried Forward in the Account Title column (left page)
4. Place a check in the Post Ref. column (left page)
5. Write each column total below the single line (both pages)
6. Rule double lines below the column totals across all amount columns to show that totals are correct (both pages)
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Angelinjones
Internet Marketing
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