Problem $3-$ GST$/$HST Payable

Note: although we did not discuss this topic in class, it is covered in the textbook, and you have already learnt this in your previous lower level accounting classes. Yup, you got this!!

Melon Cauli is a local grocery store that uses a perpetual inventory system. Melon Cauli sells goods on credit for $$10,000.$ The applicable GST rate is $10\%.$ The cost of goods sold was $$6,000.$ Sales taxes are remitted to the Canada Revenue Agency. Prepare the necessary journal entries for this transaction on the date the goods are sold and for the remission of sales taxes collected on the date of sale to the CRA.

Sale of Goods

$\backslash$table$[[$ACCOUNT NAME,Amount $($debits are positive, credits negative$)],[,],[,],[,],[,]]$

Remission of Sales Taxes

$\backslash$table$[[$ACCOUNT NAME,Amount $($debits are positive, credits negative$)],[,],[,],[,],[,]]$

Intermediate Financial Accounting II

$6|$Page

Midterm Review Package