A cash register tape shows cash sales of $2,000 and provincial sales tax (PST) of $120. The journal entry to record this information is

Question

Quizplus · Accepted Answer

The journal entry to record cash sales and provincial sales tax would be a debit to Cash for $2,120 (the total amount received), a credit to Sales Revenue for $2,000 (the amount of the sale), and a credit to PST Payable for $120 (the amount of the PST collected). The correct journal entry is:
Debit Cash $2,120
Credit Sales Revenue $2,000
Credit PST Payable $120
Choice C is the only option that matches this entry.

A Cash Register Tape Shows Cash Sales of $2,000 and Provincial