Flash Brothers sells merchandise for $85,000 cash on July 31 (cost of merchandise is $42,000). The sales tax law requires Flash Brothers to collect 10% sales tax on every dollar of merchandise sold.

4. Flash Brothers sells merchandise for $85,000 cash on July 31 (cost of merchandise is $42.000). The sales tax law requires Flash Brothers to collect 10% sales tax on every dollar of merchandise sold. A. Record the entry for the sale and its applicable sales tax.(Assume the company uses the perpetual inventory method to keep track of inventory)