To Which Account Should the Amount of Sales Tax Paid

question 56

Multiple Choice

To which account should the amount of sales tax paid on the purchase of new machinery be debited?

• A) The separate deferred charge account.
• B) The machinery account.
• C) The accumulated depreciation for machinery account.
• D) The sales tax expense account.

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Definitions:

Adjusted Trial Balance

A statement showing all balances of ledger accounts after adjustments, used to prepare financial statements.

Adjustments Column

A column in journals or ledgers where adjustments are made to correct or update account balances before the preparation of financial statements.

Unadjusted

Refers to figures or entries that have not been modified to reflect adjustments, corrections, or changes.

Adjusted

Adjusted generally refers to alterations made to financial statements or data to correct for discrepancies or to account for extraordinary events.