Guidance notes, sales should be shown on gross amt ?
This query is : Resolved
04 March 2012
hello everyone,
i have studied in the guidance note that sales should be shown on gross basis(incl. all taxes)
but i donot understand how this is practically possible.
suppose i make sale of Rs.100 and vat is Rs.10 then we will pass the following entry
Mr. X dr-----------100
to Sale-----------90
to Vat payable----10
now in p&l a/c sales will be shown as Rs.90 and not Rs.100.
i m confused how sales can be shown at Rs.100.
thanks in advance.
Waiting for your reply.
i have studied in the guidance note that sales should be shown on gross basis(incl. all taxes)
but i donot understand how this is practically possible.
suppose i make sale of Rs.100 and vat is Rs.10 then we will pass the following entry
Mr. X dr-----------100
to Sale-----------90
to Vat payable----10
now in p&l a/c sales will be shown as Rs.90 and not Rs.100.
i m confused how sales can be shown at Rs.100.
thanks in advance.
Waiting for your reply.
04 March 2012
Dear Abhishek
Your doubt is regarding "whether sales tax would form part of turnover or not". Please refer to the guidance note on sec 44AB which clearly mentioned that sales tax/excise duty collected should not be taken into account if they are separately credited to sales tax/excise account"
Regards
Your doubt is regarding "whether sales tax would form part of turnover or not". Please refer to the guidance note on sec 44AB which clearly mentioned that sales tax/excise duty collected should not be taken into account if they are separately credited to sales tax/excise account"
Regards
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