1%, 20% and Purchase 8 E

Last week, it was a bit hectic at our office as we had to file a lot of stock details before June 30. Although it was not a tough job, but still was a bit monotonous.  Anyway, now it is over and we are back to our basic book keeping work.

Today I was doing preparing purchase voucher and learned that there are 2 additional VAT %, 1%, and 20% (soft drinks).

If a purchase bill contains different VAT enteries, for example 4 and 12.5%, then we have to prepare seperate purchase vouchers for the same in tally.

Similarly, some times, some businessmen instead of entering seperate cess, mix it with VAT while showing in bill, so for them, 12.5% becomes 12.6%.  In dealing with such type, we have segregate the 1% from 12.6 before entering in tally..

Let us for example say that tax of 12.6% VAT purchase is Rs. 356.

so, what we do is  = 356 - 3.56 = 352.44 (subtracting 1% of 356)

now, this is the 12.5% VAT amount

to calculate amount on which this VAT was paid = 352.44/12.5*100= 2819.52.

Another thing which I learned today was Purchase 8 E.  Businesses have to maintain separate ledger called purchase 8 E for purchases made from house/self help units. Since this is cash purchase, payment voucher is used.  This is charged under 4% VAT.
  

Bank account

Learnt about preparing bank account from bank statements.


Bank account may be of 2 types, it may be plain bank account or overdraft account.  To discern it, study the deposit section of bank statement carefully.  If on depositing, the amount balance increases, it is bank account, where as on deposit if account balance decreases then it is overdraft account.  Prepare ledger account for bank keeping in mind the suitable under (.i.e overdraft or bank account).


In bank statements, there are 2 types of dealings.


1.  Deposit.
2.  Withdrawal.


For deposit, there is no complexity as always contra voucher will be used and entry will be


Bank a/c dr
                 To cash


For withdrawal,


A couple of cases arises.
1.  When withdrawal is for paying a known creditor.


Payment voucher is used


Sundry creditor a/c dr
                                To Bank


2.  Payee not specified.


Contra voucher is used


Cash a/c dr
                  to Bank


Dont forget to give cheque number in narration for withdrawals.
                  

sales voucher

After completing purchase voucher, i moved on to sales voucher.  Elsie mam told me that although technically it was sales voucher, it was created for showing cash sales, which could not be done in tally sales voucher, so used receipt voucher instead.


for 0% sales


entry was


Cash a/c dr
                To sales 0%


For 4%


Cash a/c dr
                 To sales 4%
                 To output-4%
                  To cess


Similarly for 12.5% also


To check whether the total of entries matches with the total sales report for a particular month, there are 2 ways:


1.  Go to P and L, then go to sales and select whichever u want, i.e. 0, 4, or 12.5
2.  Display, go to A/c book, go to Ledger, enter sales 0, 4, or 12.5...




Unlike purchase voucher, here I proceeded in reverse manner, i.e. first entry was March 2010, then February 2010 and so on....phew...managed to enter till January 14, 2010.


I am generating these vouchers from monthly sales report given by client. 

Purchase voucher continued (12.5 and 4%)

I did purchase vouchers for 12.5 and 4 %.

The entries were:

Purchase -4% a/c dr
Input      -4%  a/c dr
cess (1% of input value) a/c dr
                                              To sundry creditor

Similarly for 12.5%

Purchase a/c dr 12.5%
Input - 12.5% a/c dr
cess a/c dr (1%of input value)
                                              To sundry creditors

To copy previous narration in the end, use Control + R.

Purchase voucher

I was given a file related to purchases by a client firm in the year 2009-2010.  I had to create a purchase voucher in Tally 5.4 and enter only those purchases which had 0% VAT.  Religious books and candles attract 0% tax, so I had to study the bills and watch out for only those where books or candles were purchased.  It was kind of easy.  My instructor (Elsie Mam) told me the other rates of tax were 4 and 12.5% and she would guide me one by one on how to go about them too.  While creating purchase vouchers, I was asked to look out for TIN (tax identification number) of the creditors and to enter the same while creating the voucher. TIN numbers are 11 digit numbers given by Kerala Government to each and every registered establishments.

Also, I was asked to use the right side of the keyboard for all numeric entries as one can get data entered quickly using that side.

The four hours just flew by..........