regarding income tax, advance tax, Provision for income tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

22 May 2010 dear sir

what will be the entry passed for the adjustment of advance tax agaisnt income tax and how to make provision for income tax?

please clarify the following entry:
Income tax provision a/c dr 100000.00
to advance tax a/c 75000.00
to short provision of I. tax (P&L) 25000.00

Akbar Mirza

Akbar Mirza (Expert)
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22 May 2010 1) Provision of Income Tax:

Income Tax A/c ..........Dr. 100000
To Income Tax Provision 100000

2) Payment of Advance Tax:

Advance Tax A/c...........Dr. 75000
To Bank A/c 75000

3) Adjustment of Adv. Tax Against Tax Prov.:

Income Tax Prov. A/c......Dr. 100000
To Advance TAx A/c 75000
To Excess Provision of I.Tax(P&L) 25000

Ram Avtar Singh

Ram Avtar Singh (Expert)
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22 May 2010 1) Provision of Income Tax:

Profit & Loss A/c ...Dr. 100000
To Income Tax Provision 100000

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Akbar Mirza

Akbar Mirza (Expert)
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22 May 2010 We have made provision of Rs. 100000/- but agains which tax paid to required is only 750000/- hence we have made excess provision of tax, hence next year we will pass 3rd entry & excess provision shall be cr. to P& L A/c