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    Yusf's Avatar
    Yusf Posts: 198, Reputation: 3
    Junior Member
    		  
    #1

    Dec 24, 2013, 12:03 AM
    Little help with vat please.
    I have stumbled across vat. Can anyone please write me the journal entries for the following?
    Cash sales 500. Vat 50.
    Cash purchase 1000. Vat 100.
    Credit sales 1500. Vat 150.
    Credit purchase 2000. Vat 200.

    The values are random. I just want to know Which accounts will be credit and which will be debit.
    tickle's Avatar
    tickle Posts: 23,796, Reputation: 2674
    Expert
    		  
    #2

    Dec 24, 2013, 10:10 AM
    VAT tax (UK) is value added tax, usually 20 per cent, on product, material. And services charged back to the consumer and reported to the government on a quarterly basis. In CDA it is GST, goods and services tax.

    Offered as a hint so you know how to account for it.
    Yusf's Avatar
    Yusf Posts: 198, Reputation: 3
    Junior Member
    		  
    #3

    Feb 10, 2014, 02:43 AM
    Yes. Its like Cash DrSales creditVat credit. Oppesite entry for purchase.
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
    Ultra Member
    		  
    #4

    Feb 10, 2014, 09:42 PM
    what you would usually do is have a clearing account VAT and debit/credit the amounts collected and paid, then you reconcile these transactions to do theVAT return
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