Whether excise duty included in sales?

hi Chintan Shah,

Excise duty charged on Sales not considered at Sales according to accouting principle. Because, excise duty amount is liability amount, we need to pay to government on due date and it is balance item.

Moreover, it should not be considered as expenses at time payment.

with regards,

CMA.Baskar.V

hi, you can go through Guidance note on Excise duty for better clarification. It is stated therin that excise duty collected on sales should be disclosed by way of deduction from sales in the financial statements.

Hello chintan,

In our company while preparing the financial statements, we use to disclose the gross sales including the amount of excise duty & fromthis amount excise duty is deducted to get the net sales.

So, neither it is include in the sales at the time of collection nor it is considered as expense at the time of payment.

Please refer to the Guidance note on excise duty.

Guidance note on " Treatment Of excise duty " given by the Institue makes it very clear about ur problems..

 Mr. Bhaskar is absolutely right

Agree with CMA. Bhaskar V.

In accounting -

1) Sale is basic sales value (Income)

 2) Excise duty collection is liability which is payable to government

3) Excise duty payment is payment of liability created in (2) above.

In schedule VI presentation -

Sales are shown as basic sales value + excise duty collection

Less : Excise duty paid