Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Melanie operates Mel's Bakery in Foxboro, Massachusetts with retail stores in Connecticut, Maine, Massachusetts, New Hampshire, and Rhode Island. Mel's also ships specialty breads nationwide

image text in transcribed

Melanie operates Mel's Bakery in Foxboro, Massachusetts with retail stores in Connecticut, Maine, Massachusetts, New Hampshire, and Rhode Island. Mel's also ships specialty breads nationwide upon request. Determine Mel's sales tax collection responsibility and calculate the total sales taxility for Massachusetts, Connecticut, Maine, New Hampshire, Rhode Island, and Texas using the following information: a) The Massachusetts stores earn $500,000 in sales. Massachusetts' sales tax rate is 5 percent; assume it exempts food items. b) The Connecticut retail stores have $390,000 in sales ($300,000 from in-store sales and $90,000 for catering) and $10,000 in delivery charges for catering activities. Connecticut sales tax is 6 percent and excludes food products, but taxes prepared meals (catering). Connecticut also imposes sales tax on delivery charges on taxable sales. c) Mel's Maine retail store has $250,000 of sales ( $200,000 for take-out and $50,000 of in-store sales). Maine has a 5 percent sales tax rate and a percent sales tax on prepared food; it exempts other food purchases. d) The New Hampshire retail stores have $260,000 in sales. New Hampshire is one of five states with no sales tax tax rate of 8 percent. New Hampshire considers any food or beverage served by a restaurant for consumption on or off the premises to be a meal. e) Mel's Rhode Island stores earn $300,000 in sales. The Rhode Island sales tax rate is 7 percent and its restaurant surtax is 1 percent. Rhode Island considers Mel's a restaurant because its retail store has seating. f) One of Mel's best customers relocated to Texas, which imposes an 8.25 percent state and local sales tax rate but exempts bakery customer entertains guests regularly and ordered $5,000 of food items this year

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Bookkeeping And Accounting

Authors: Greg Shields

1st Edition

1983673536, 978-1983673535

More Books

Students also viewed these Accounting questions

Question

=+2. Explain the interactions in the newspaper and magazine market!

Answered: 1 week ago