6800*.64= 4352
Ernesto payed $ 4352 in tax
Answer and Explanation:
As per the data given in the question,
The central bank have various tools to apply expansionary policy and these tools are :
- Reserve ratio.
- Discount rate.
- Open market operations.
The open market operations include the buying and selling of government owned securities by central bank to impact the monetary base in the economy. In case of any recession, the central bank should purchase government securities to enhance the money supply. Because whenever they do any kind of open market purchase there would definitely be increase in money in the economy. That's why increment in money supply decrease the interest rate in economy.
Nominal interest rate is the cost of borrowing so if there is decrement in interest rate, there would be consumption and investment activities. these both are the component of aggregate demand so the aggregate demand will increase, and this increment in aggregate demand helps the economy to recover in the situation of recession.
In this item, since the purchase has been made and that it was due to the agreement that that said amount is paid rather than a smaller one, the element that should be taken to the journal should be $1.7 in cash out column. The money is used to pay the liability. In this manner, the corporation will not have the need to physical call on someone to explain when the numbers in the journal do not match.
The correct answer would be A
Answer:
Debit Cash account $8,400
Credit Sales account $8,000
Credit Sales tax payable $400
Being entries to record cash proceeds from sale.
Explanation:
Since total cash received from the sale was $8,400, a debit entry for this amount is posted to the Cash account.
Of the amount received, $400 is for sales tax. This is a liability to the organization and as such a credit entry for sales tax payable of $400 is recorded until it is remitted.
The balance of $8000 is the actual amount to be recognized as sales.
