Question

Ms. Pike, who lives in California, traveled to Oregon to purchase gold jewelry for $16,000. California has a 7.5 percent sales and use tax, while Oregon has no sales and use tax. Compute the use tax that Ms. Pike owes to California on the jewelry purchased in Oregon. Compute the use tax that Ms. Pike owes to California if she purchased the jewelry in New Mexico and paid that state’s 5.125 percent sales tax on the transaction.

Answer 1

Answer:

Pike owes $1200 in taxes is she the purchase $16,000 in Oregon and owes $820 in transactions if she purchase $16,000 in Oergon.

Explanation:

Re call that the total tax is the rate tax time the purchase amount.

T= R * P

Then the use tax that Pike owe to California for the purchase of $16,000 in Oregon Tc taking a rate of 7.5 percent is:

Tc =  0.075 * $16,000  = $ 1,200

The use tax  that Pike owe to California for the purchase of $16,000 in New Mexicon Tn dont take into account the sales but the transaction rate of 5.125 percent:

Tn =  0.05125 * $16,000  = $820