Emerald Jewelers is a retail store operating in Ontario, where the GST is 5% and the PST is 8%. For the month of June, Emerald sold $45,000 worth of jewelry to customers, 60% of which were cash sales and the balance paid by credit cards. Credit card fees are 2.5%. Based on this information, what is the total debit to Accounts Receivable for the month of June?
A) $50,850
B) $50,342
C) $44,550
D) $45,000

Question

Quizplus · Accepted Answer

The total sales including GST and PST is $45,000 * 1.13 = $50,850. Since 40% of sales were on credit, the debit to Accounts Receivable is 40% of $50,850, which is $20,340. However, the question asks for the total debit, which includes the full sales amount including taxes, hence $50,850.

Emerald Jewelers Is a Retail Store Operating in Ontario, Where