On 26-4-2011, M/s National Traders received a sales order from Excel Traders, Mumbai for 4 photo copying machines priced at ` 43,000 each. M/s National Traders raised a sales invoice for the said item vide invoice number 012, despatched 2 nos and requested the branch office – National Enterprises to despatch remaining quantity. CST @ 2% was charged while invoicing against C Form. The sale value and CST amount of goods despatched by branch office was reversed on 27-4-2011.
The above is a question given by Tally Solutions in its guidance book and following are the entries they gave:
Entry 1 (Interstate Sale Entry)
Excel Traders 175440
To Interstate Sales 2% 172000
To CST 2% - Interstate Sales 3440
Entry 2 (Reversal of Interstate Sales to Sales Outside the State)
Interstate Sales 2% 86000
To Interstate Sales - Tax Free 86000
Entry 3 (Transferring value of CST to Branch)
CST 2% Interstate Sales 1720
To National Enterprises 1720
My questions are following
I am clear as to the first entry.
But what are they doing in remaining two !!
Thanks
Shivani
shivaniadream @ gmail.com
CAclubindia
