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Sample Sales

L KANAGARAJ (Assistant Manager-Finance) (615 Points)

15 March 2010

Sirs,

If the Manufacturing Company want to sell some goods for Sample purpose.

What is the procedure concerned with Excise Duty & VAT in Invoice.

Where the amount will reflect in P& L and B/S.

Thanks

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1 Replies

Vinay (Consultancy) (39 Points)
Replied 15 March 2010

The VAT is applicable on the sale of goods nad hence there will be no liability for VAT. Secondly the excise duty is applicable on the production of goods hence you will have to pay the excise duty on the goods taht are being sent as sample.

The sample being a sales promotion expense (by nature) hence will have to be taken under the head selling expenses.

originally posted by : L KANAGARAJ

Sirs,

If the Manufacturing Company want to sell some goods for Sample purpose.

What is the procedure concerned with Excise Duty & VAT in Invoice.

Where the amount will reflect in P& L and B/S.

Thanks