Journal ebtry for vat input tax credit
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
17 June 2014
rm purchase-1000(20 kgs)
vat-4
other expenses-5
total-1009
journal entry
purchases dr 1009
party cr 1009
purchase cr 4
vat receivable dr 4
while recording consumption the avg rate (1009/20) ie 50.45 is used.
please let me know if the aforesaid journal entries are correct.Also let me know if the issue price(50.45) for consumption is right or wrong
vat-4
other expenses-5
total-1009
journal entry
purchases dr 1009
party cr 1009
purchase cr 4
vat receivable dr 4
while recording consumption the avg rate (1009/20) ie 50.45 is used.
please let me know if the aforesaid journal entries are correct.Also let me know if the issue price(50.45) for consumption is right or wrong
CMA Ramesh Krishnan
(Expert)
17 June 2014
Raw material price will be considered only Rs.1005, as per AS-2, while doing valuation, refundable taxes will be deducted, here VAT is refundable ( adjustable with your output ) so valuation will be based Rs.1005/20, (assuming other expenses relevant to purchase)
Rupesh Jain
(Expert)
18 June 2014
you have tto take 1005 due to Rs. 4 is vat amount is refundable to you . so it is not part of your costing.
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