Question 4 of 40 | Page 4 of 40

Question 4

A business sold some inventory on credit for $5,000 before taxes. The sale is subject to 5% goods and services tax (GST) and 7% provincial sales tax (PST). The business uses a perpetual inventory system. What is the amount that will be recorded in the GST payable account as a result of this sale?

a

$350 debit

b

$250 debit

c

$350 credit

d

None of these answers is correct.

e

$250 credit