03 January 2011
Assuming that you are going to avail excise duty credit on purchases, the cenvat credit should be booked under cenvat received account. It should be current asset and will not form part of purchase cost.
For example. You have made a purchase of Rs. 100 and Ex. duty is Rs.16. The total amount is Rs.116.
The purchase entry should be
Dr. Purchase Account Rs.100 Dr. Centvat received Rs 16
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