how computaion vat (gujarat)
This query is : Resolved
27 March 2011
sir iam a fresh accountant
please give me vat computation & what is c from
please give me vat computation & what is c from
28 March 2011
FOR UNDERSTAND THE VAT COMPUTATION
Basic price of selling product (Landed cost of purchased goods + Manufacturing cost & other costs + Margin = Basic price)Add: Excise duty (if applicable & rate of duty will differ for each & every commodity))Add both these amounts and on this the VAT will be levied will differ each & every commodity)Eg.: If 1kg of Plastic raw material's landed cost is Rs.50/- and convertion cost to plastic container is Rs20/- (Electricity Wages Administrative expenses & Margin is Rs.14/-)The Basic price of 1 Kg Plastic container is Rs.84/-Excise duty on Basic (Rs.84/-) @ 16 = Rs.13.44VAT @ 8 on (Basic Rs.84+ Excise 13.44) Rs.97.44 = Rs.7.795 Say Rs.7.80/- Accounting of VAT If 1 Kg of Plastic raw material purchased @ Rs.50/- which includes VAT @ 3 = Rs.1.50You can take credit of the VAT input (as in Excise duty): The accounting entry would be: Purchase A/c (Raw materials) Dr 48.50
VAT payable A/c Dr. 1.50 (Contra-1)
To Supplier's A/c 50.00
(Being the raw materials purchased acctd)
After sales when we make payment to Govt the entry would be
Party's A/c Dr. 105.24
To Basic sales of containers 84
To Excise duty payable A/c 13.44
To VAT payable A/c 7.8 (Contra-2)
VAT payable A/c Dr. 7.8 (Contra-2)
To VAT payable A/c Dr. 1.5 (Contra-1)
To Bank A/c 6.3
(Being the VAT payable adjusted and difference paid to Dept.)
Filing return of VAT As per Form Credit availed on inputs VAT Payable Difference paid to Govt.
(Purchases) (Sales)
(A) (B) ( C = (B - A) )
Rs.1.50 Rs.7.80 Rs.6.30
ABOUT C-FORM:-
Form C is issued by the dealer for purchasing goods from the dealer out side the state in which he resides the effect can be understood looking at following example:-
IF Mr A Registered Dealer in Hyderabad (AP) wants to purchase goods from Mr B a registered dealer in Mumbai.Mr B who is selling the goods will charge VAT @ 4% or 12.5% on the goods if Mr A issues him “C” Form then Mr B should Charge him CST @ 2% so Mr A is Saving Tax.
Basic price of selling product (Landed cost of purchased goods + Manufacturing cost & other costs + Margin = Basic price)Add: Excise duty (if applicable & rate of duty will differ for each & every commodity))Add both these amounts and on this the VAT will be levied will differ each & every commodity)Eg.: If 1kg of Plastic raw material's landed cost is Rs.50/- and convertion cost to plastic container is Rs20/- (Electricity Wages Administrative expenses & Margin is Rs.14/-)The Basic price of 1 Kg Plastic container is Rs.84/-Excise duty on Basic (Rs.84/-) @ 16 = Rs.13.44VAT @ 8 on (Basic Rs.84+ Excise 13.44) Rs.97.44 = Rs.7.795 Say Rs.7.80/- Accounting of VAT If 1 Kg of Plastic raw material purchased @ Rs.50/- which includes VAT @ 3 = Rs.1.50You can take credit of the VAT input (as in Excise duty): The accounting entry would be: Purchase A/c (Raw materials) Dr 48.50
VAT payable A/c Dr. 1.50 (Contra-1)
To Supplier's A/c 50.00
(Being the raw materials purchased acctd)
After sales when we make payment to Govt the entry would be
Party's A/c Dr. 105.24
To Basic sales of containers 84
To Excise duty payable A/c 13.44
To VAT payable A/c 7.8 (Contra-2)
VAT payable A/c Dr. 7.8 (Contra-2)
To VAT payable A/c Dr. 1.5 (Contra-1)
To Bank A/c 6.3
(Being the VAT payable adjusted and difference paid to Dept.)
Filing return of VAT As per Form Credit availed on inputs VAT Payable Difference paid to Govt.
(Purchases) (Sales)
(A) (B) ( C = (B - A) )
Rs.1.50 Rs.7.80 Rs.6.30
ABOUT C-FORM:-
Form C is issued by the dealer for purchasing goods from the dealer out side the state in which he resides the effect can be understood looking at following example:-
IF Mr A Registered Dealer in Hyderabad (AP) wants to purchase goods from Mr B a registered dealer in Mumbai.Mr B who is selling the goods will charge VAT @ 4% or 12.5% on the goods if Mr A issues him “C” Form then Mr B should Charge him CST @ 2% so Mr A is Saving Tax.
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