Exicise duty payable on sale of product showing as income under indirect income head.Is it right procedure of accounting?
Exicise duty payable on sale of product showing as income under indirect income head.Is it right procedure of accounting?
It can be done, but at the end of every month such excise duty levied should be transferred to current liabilities.
IT SHOULD BE UNDER CURRENT LIABILITY
ALL TAXES AND DUTY IS ALWAYS LIABILITIES NOT INCOME WHICH WE HAVE TO PAY TO GOVT. IN
CURRENT PERIOD OR FUTURE PERIOD .
I think the entry should be-
Dr. Debtor A/c 100
Dr. ED received 12
Cr. Sales A/c 100
Cr. ED Payable 12
Please correct me if my understanding is incorrect
Entry should be like this
Debtor A/c Dr 112
To Excise payable A/c 12
To Sales A/c 100
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