Layton Company does not ring up sales taxes separately on the cash register.Total receipts for October amounted to $29,400.If the sales tax rate is 5%, what amount must be remitted to the state for October's sales taxes?

Question

Quizplus · Accepted Answer

The total receipts include both the sales and the sales tax. To find the sales tax amount, you can use the formula: Total Receipts = Sales + Sales Tax. Given a 5% sales tax rate, you can express this as Sales * 1.05 = Total Receipts. To find the Sales, divide the Total Receipts by 1.05: $29,400 / 1.05 = $28,000. The difference between the Total Receipts and the Sales is the Sales Tax: $29,400 - $28,000 = $1,400.

Layton Company Does Not Ring Up Sales Taxes Separately on the Cash