I am having 1 query regarding a/c entry
Owner of m/s A & m/s B is the same person. M/S C is dealing with both of these.
A is creditor of C and B is debtor of C. C purchased goods from A without VAT(Eg. Rs.100) and returned those goods with VAT (Rs.112.5) Now while making payment B made lower payment by Rs.112.5/- saying that it was adjusted against return to A.
Now the question is what entry will come for all these.
I saw the entry in this case was 1. Purchase from A
2. Sales to B
3. A Dr. 100, a/c write off dr.12.5 To B 112.5
But I think B should not pay less amt as goods purchased from A were returned to A so the transactions ends except that VAT portion.
Please Advice Urgent
CAclubindia
