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Purchase journal entries

Dilshan Dil (accoutant) (27 Points)

09 September 2013

Hi experts,

I need to learn the journal entries for the follow :

1 - Received vendor invoice received Rs 10,000 for 100 units.

2 - After 2 months, a debit note Rs. 2,000 received from same vendor claiming they made mistake in pricing in earlier invoice.

How will i pass entries.

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5 Replies

V Vara Prasad (Chartered Accountant) (212 Points)
Replied 09 September 2013

Purchases A/c Dr 10000

To Creditor A/c 10000

On return of Goods:

Creditor A/c Dr 2000

To Purchase returns A/c 2000

Dilshan Dil (accoutant) (27 Points)
Replied 09 September 2013

thanks for reply but my 2 question is not about return. it is due to price difference.

the actual price for 100 units is supposed to be 12,000 instead of 10,000.

1 - Inventory a/c Debit Rs 10,000
to Vendor credit Rs 10,000

but when i will get 2,000 debit note from vendor, how will i adjust this amount with previous invoice ?

first i i should reverse the old entries or how ?

Shivani (Learner) (1881 Points)
Replied 10 September 2013

Purchase 2000

To Vendor 2000

I am not clear about the sales tax (CST and VAT) part though.

Will more CST or VAT need to be paid?

An expert can through light on this.

Shivani

Dilshan Dil (accoutant) (27 Points)
Replied 10 September 2013

Thanks for reply,

but the second entry will not have any effect on 100 units cost as earlier we posted for 100 units @ Rs 100

ie., inventory (100 units) Debit Rs 10,000
To Vendor / Creditor A/c Credit Rs. 10,000

Again if i pass entry like :

Debit Inventory Rs 2,000 and Credit Vendor a/c, - The Vendor a/c will be ok but the inventory a/c will have problem as there is physical inventory for this additional 2,000.

Shivani (Learner) (1881 Points)
Replied 10 September 2013

Dilshan I m pretty much sure that you need to leave the quantity column empty and just enter 2000 in the amount column while feeding credit note in your Tally.

Shivani