All Respected Members,
Please educate me that how can we record an advance receipt invoice with charging sales tax in accounts ?
For Example:
We have to raise an advance receipt invoice of RS. 100, 000 at rate of 10% sales tax to our clint; how we will record it in accounts.
Further, please also educate that when advance payment against this invoice will receive; how we will record it in accounts too ?
It is requested to please share journal entries of both cases.
I would like to thank in advance to them who will response regarding this query
On raising advance receipt
Debit: Accounts Receivable - Client's Name Rs. 100,000
Credit: Sales Revenue Rs. 90,000 (Rs. 100,000 - Rs. 10000 sales tax)
Credit: Sales Tax Payable Rs. 10000
on receipt of payment
Debit: Cash/Bank Account Rs. 100,000 Credit: Accounts Receivable - Client's Name Rs. 100,000
CAclubindia
