entry level

This query is : Resolved

rajendra (Querist)
Follow

13 February 2008 there are three stages
1.inventory stage.
2.stores department.
3.billing stage.
in first stage what is the entry they will pass when they are purchasing plant& machinery from a supplier who is in andhra pradesh .i required the second and third entry also.if suppose VAT is applicable to the stages and what the entry will be there.
in a company why they want to make a dummy account ?
what are the reasons to maintain a dummy account ?
Is the VAT which is charged paid by the receiver or by the provider?
please give me a detail reasons for the above which i have specified............

MANAS ROUT

MANAS ROUT (Expert)
Follow

23 February 2008 A Guidance note on accounting for vat already issued by ICAI ,AS per the guideline you have maintain your accounts and treatment of vat also.
step-1
in the time of purchase of plant & machinery the entry will be
Plant & machinery a/c dr
Vat Input(capital goods) dr
To parrty/ bank/cash.
step-2
the vat input amount you have to adjust in 36 eqaul instalments and accordingly you have to credit the input(capital goods) and shown in your monthly retrn.
The asset value should be net of vat input that you are going to claim and the charge depreciation accordingly.
for detail go through the guidance note for VAT.