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Hi , Can you please assist me with the following question below :
At 1 Dec 2012 , Laurel owed sales tax to the state of $23778.
During the month of Dec she had the following trans :Sales of $800,000 exclusive of 17.5% sales tax
Purchases of $590,790 inclusive of 17.5% sales taxDuring December she has paid no tax to the state
– How much did she owe to the state for sales tax at the end of December ?
Kind Regards ,
Have you watched the free lecture on sales tax? I ask because I am not sure why you are having a problem with this question.
At the beginning of the month she owed 23778.
This month you need to add the extra owing because of this months sales: 17.5% x 800,000.
Also, however, you need to subtract the amount suffered on this months purchases. Because the purchases were tax inclusive, the tax on them is 0.175/1.175 x 590790
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