final accounts-doubts

Others 654 views 1 replies

hira singh

student

42 Points Joined November 2010

While preparing final account how to treat the following.

1. Taxes paid while purchase the raw material.

2. Taxes like sales tax paid at the time of sales.

what amount should be shown in purchase and sales in Profit and loss a/c.

Thanks in advance.

Replies (1)

sivaram

Asst Mgr-Taxation

6918 Points Joined April 2009

If Purchase of Raw material has excise duty and VAT and if excise duty is cenvatable and if it is a local purchase on which u avail VAT Credit include only basic amount in purchases .If excise duty not cenvatable and if it is a inter state purchase include the whole amount in purchases

For sales only assessable value goes to sales and VAT charged goes to Vat Payable