Brian sold goods to Mike on credit for $1100 including GST. The correct accounting entry to record this transaction in Brian's books is:

Question

Quizplus · Accepted Answer

The correct accounting entry to record the credit sale of goods including GST is to debit Accounts Receivable for the total amount of the sale, $1100, and credit Sales for the net amount of the sale excluding GST, which is $1000. Since GST is payable to the tax authorities, a separate credit entry needs to be made in the books of accounts to record the GST payable. Therefore, the correct entry would be DR Accounts receivable $1100; CR Sales $1000, CR GST payable $100.

Brian Sold Goods to Mike on Credit for $1100 Including