Querry regarding accounting entries to be passed.
This query is : Resolved
19 September 2016
dear sir my client is seller who deals in mobiles.he purchased mobile including 14% vat .now out of his stock he used 1 mobile for his office use.now he want to show mobile under fixed asset.issue is if he show mobile as a sale than vat liability on sale will come.but he dont want to show it under sale and dont want to pay vat .so what entry should be passed for this purpose..debiting fixed asset and crediting purchase doesnt seems to be justifiable entry because its not personal use.kindly guide me.this querry is for audit purpose.my point of view was to make adjustment entry, 1st debit drawing n credit purchase & second entry will be debit fixed asset n crediting capital.kindly guide me.
20 September 2016
debit mobile (under fixed asset)
credit purchase
credit vat on purchase (The proportionate share of VAT on this mobile)
(In narration, write the description of the entry)
credit purchase
credit vat on purchase (The proportionate share of VAT on this mobile)
(In narration, write the description of the entry)
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