question archive Sales tax of $100 is collected from a customer to be remitted to the state at a later date
Sales tax of $100 is collected from a customer to be remitted to the state at a later date
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Sales tax of $100 is collected from a customer to be remitted to the state at a later date. What journal entry is used to record this transaction?
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| Date | General Journal | Debit | Credit |
| Cash | 100 | ||
| Sales Taxes Payable | 100 |
When sales tax is collected from a customer to later remit to the state it must be credited into a separate liability account called sales taxes payable. Once the taxes are remitted to the state the sales taxes payable account will be decreased.
