For a Retailer Required to Collect Sales Taxes from Customers

question 141

Multiple Choice

For a retailer required to collect sales taxes from customers, all of the following adaptations would be made to the sales journal except:

• A) Column totals would continue to be posted as usual.
• B) A Sales Taxes Payable credit column would be added.
• C) There would be a separate Accounts Receivable debit column.
• D) A Sales Taxes Payable debit column would be added.
• E) There would be a separate Sales credit column.

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Definitions:

Fixed Costs

Expenses that do not change in total irrespective of the volume of goods or services produced by a company.

Break Even

The point at which total revenues equal total expenses, with no net loss or profit.

Variable Costs

Expenses that are directly tied to the rate of goods produced or services sold, such as the cost of materials and labor involved.

Fixed Costs

Costs that remain constant for a business over a period, regardless of the level of goods or services produced.