Record the following transactions of Fashion Park in a gener

Record the following transactions of Fashion Park in a general journal. Fashion Park must charge 8 percent sales tax on all sales.


DATE
TRANSACTIONS
2019

April
2
Sold merchandise for cash, $2,500 plus sales tax.

3
The customer purchasing merchandise for cash on April 2 returned $250 of the merchandise; provided a cash refund to the customer.

4
Sold merchandise on credit to Jordan Clark; issued Sales Slip 908 for $1,050 plus tax, terms n/30.

6
Accepted return of damaged merchandise from Jordan Clark; issued Credit Memorandum 302 for $150 plus tax. The original sale was made on Sales Slip 908 of April 4.

Solution

Journal entries Date Accounts title and explanation Debit $ Credit $ 2-Apr Cash Account Dr. 2700      Sales revenue Account 2500      Sales tax payable (2500*8%) 200 3-Apr Sales return And allowance Account Dr. 250 Sales tax payable (250*8%) 20       Cash account 270 4-Apr Accounts receivable-Jordan Dr. 1134     Sales revenue Account 1050     Sales tax payable (1050*8%) 84 6-Apr Sales return and allowance Account Dr. 150 Sales tax payable (150*8%) 12     Accounts receivable-Jordan 162