Question
Excise Taxes Reagan Gas provides gas utilities to a wide area of eastern Illinois. During the month of May, it billed 19,000 of its residential
Excise Taxes
Reagan Gas provides gas utilities to a wide area of eastern Illinois. During the month of May, it billed 19,000 of its residential customers located in the town of Moline a total of $2,320,000 for electricity (this is considered revenue). In addition, Reagan is required to collect the following taxes:
- State Excise Tax: A tax of $3.00 per customer plus 2% of billing used to fund the Kentucky Energy Commission
- Federal Excise Tax: A tax of $0.50 per customer plus 0.1% of billing used to fund the Federal Energy Commission
Required:
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When required, round your answers to two decimal places.
1. Determine how much Reagan will bill these customers in total for the month of May. $fill in the blank 15bf33f5df8c07d_1
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2. Prepare the entry to record the billing of these amounts. If an amount box does not require an entry, leave it blank.
blank | Accounts ReceivableCashExcise Taxes Payable (Federal)Sales RevenueUtilities Expense | ||
Accounts PayableCashIncome Taxes PayableSales RevenueUnearned Sales Revenue | |||
Accounts PayableAccounts ReceivableExcise Taxes Payable (State)Income Taxes ExpenseInterest Payable | |||
Accounts PayableCashExcise Taxes Payable (Federal)Income Taxes PayableUtilities Expense | |||
(Record sale) |
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3. Prepare the entry to record the collection of these amounts. If an amount box does not require an entry, leave it blank.
blank | Accounts PayableAccounts ReceivableCashSales RevenueUnearned Sales Revenue | ||
Accounts PayableAccounts ReceivableCashSales RevenueUnearned Sales Revenue | |||
(Record collection of receivables) |
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4. Prepare the entry to record the payment of the state excise taxes to the appropriate governmental unit. If an amount box does not require an entry, leave it blank.
blank | Accounts PayableAccounts ReceivableCashExcise Taxes Payable (State)Income Taxes Payable | ||
Accounts PayableAccounts ReceivableCashExcise Taxes Payable (State)Income Taxes Payable | |||
(Record payment) |
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