General Lighting During the First Quarter of 2013, the Company Sold 4,000

General Lighting
During the first quarter of 2013, the company sold 4,000 batteries on credit for $150 each plus state sales tax of 6%.
-Refer to General Lighting. The price of each battery includes a $1.95 federal excise tax. Any taxes collected must be paid to the appropriate governmental units at the end of the quarter. Which of the following is the proper journal entry to record for the sale of the batteries?

A) Accounts Receivable 643,800 Sales Revenue 600,000
Sales Tax Payable 36,000
Federal Excise Tax Payable 7,800
B) Accounts Receivable 636,000 Sales Revenue 592,200
Sales Tax Payable 36,000
Federal Excise Tax Payable 7,800
C) Accounts Receivable 636,000 Excise Tax Expense 7,800
Sales Revenue 607,800
Sales Tax Payable 36,000
D) Accounts Receivable 636,000 Sales Tax Expense 36,000
Excise Tax Expense 7,800
Sales Revenue 643,800

Correct Answer:

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