Loong Industries Sells Materials on March 16 for $12,000 Cash

question 16

Multiple Choice

Loong Industries sells materials on March 16 for $12,000 cash, subject to 8% sales tax. The cost of the materials sold is $5,700. The revenue portion of the transaction is recorded as:

• A)Debit Cash $12,000; credit Sales Taxes Payable $960; credit Sales $11,040.
• B)Debit Accounts Receivable $12,960; credit Sales $12,000; credit Sales Taxes Payable $960.
• C)Debit Cash $12,960; credit Sales $12,000; credit Sales Taxes Payable $960.
• D)Debit Sales $12,960; credit Cash $12,000; credit Sales Taxes Payable $960.
• E)Debit Cash $12,960; credit Sales $12,960.

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Definitions:

Glacial Evidence

Glacial evidence comprises physical features left on the landscape that indicate the past presence and movement of glaciers, such as striations, moraines, and glacial erratics.

Wegener's Hypothesis

The theory proposed by Alfred Wegener suggesting that continents drift across the Earth's surface through geological time, which later became known as continental drift.

Continental Drift

The theory that the continents have moved across the Earth’s surface over geological time, proposed by Alfred Wegener.

Divergent Plate Boundary

A tectonic boundary where two plates are moving away from each other, often resulting in the formation of new crust as magma rises to the surface.