13Western Inc. sells merchandise to its customers in the first quarter of 2020 and collects $821,500. The amount collected includes sales tax of 6%. The sales tax amount will be submitted to taxing authorities on a quarterly basis with the next payment due April 5, 2020.

Assuming no other transactions affecting sales tax, what is the balance in Sales Taxes Payable on March 31, 2020?

$49,290

$0

$46,500

$15,500

$139,500

15Armstrong Inc. sold $200,000 of gift cards in 2020. Assume no other sales of gift cards. The gift cards are able to be used in 2020, 2021, or 2022. Armstrong expects a total of $10,000 of gift cards will never be redeemed.

Gift Card redemptions, 2020	$40,000
Gift card redemptions, 2021	$100,000
Gift Card redemptions, 2022	$50,000

Under the proportional method, what would Lazarus Inc. recognize for gift card breakage revenue in 2020 and 2021?

$2020: $10,000 2021: $0

2020: $2,105 2021: $5,263

2020: $2,525 2021: $4,545

2020: $2,000 2021: $2,500

2020: $3,333 2021: $3,333