A Customer Paid a Total of $84,000 for a Purchase

question 74

Multiple Choice

A customer paid a total of $84,000 for a purchase, including 5% PST (provincial sales tax) . What was the PST amount?

• A) $4,000
• B) $4,200
• C) $84,000
• D) $80,000

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Definitions:

Related Asset

An asset that is connected or associated with another asset in a business, often through ownership or use in similar processes.

Prepaid Rent

An asset account that represents payment for rent that covers a future period, reflecting rent expense that has not yet been incurred.

Adjusting Entry

A journal entry made at the end of an accounting period to record unrecognized income or expenses in order to maintain accrual accounting accuracy.

Rent Expense

The cost incurred for using a property or space for business or residential purposes.