Cantrell Company Is Required by Law to Collect and Remit

question 135

Multiple Choice

Cantrell Company is required by law to collect and remit sales taxes to the state.If Cantrell has $8,000 of cash sales that are subject to an 8% sales tax,what is the journal entry to record the cash sales?

• A)Debit Cash $8,000;credit Sales $7,360;credit Sales Taxes Payable $640.
• B)Debit Sales Taxes Payable $640;debit Cash $7,360;credit Sales $8,000.
• C)Debit Cash $8,000;credit Sales $8,000;and record the taxes when paid.
• D)Debit Cash $8,640;credit Sales $8,000;credit Sales Taxes Payable $640.
• E)Debit Accounts Receivable $8,640;credit Sales $8,000;credit Sales Taxes Payable $640.

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Definitions:

Ventromedial Prefrontal Cortex (vmPFC)

A part of the frontal lobe in the brain associated with the processing of risk and fear, decision-making, and emotional responses.

Amygdala

A region of the brain within the temporal lobe, involved in the processing of emotions such as fear, anger, and pleasure.

Moral Development

The process through which individuals learn to distinguish right from wrong and to develop the right attitudes and behaviors towards societal rules.

Elaboration

A memory strategy in which one imagines a scene or story to link the material to be remembered.