A business sold some inventory on credit for $5,000 before taxes. The sale is subject to 5% goods and services tax (GST) and 7% provincial sales tax (PST). The business uses a perpetual inventory system. What is the amount of the accounts receivable that was recorded as a result of this sale?

Question

Quizplus · Accepted Answer

The total amount of accounts receivable includes the original sale amount plus both the GST and PST. The calculation is $5,000 + ($5,000 * 5%) + ($5,000 * 7%) = $5,000 + $250 + $350 = $5,600.

A Business Sold Some Inventory on Credit for $5,000 Before