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A factory is registered in both Excise and Vat
Hence it gets input of Vat which is adjusted with Output Vat
Also it gets input of Excise and Service tax (called Cenvat) which is adjusted with Output Excise
It is normally of 3 types
| TYPES OF CENVAT |
| Cenvat on Input Services |
| Cenvat on Inputs(Excise on Goods Used for Production like Raw Material,Consumables and Packing Materials) |
| Cenvat on Capital Goods |
Note:-
No Input is available of
1.CST on Purchases and Expenses
2.Swachh Bharat Cess on Expense Bills
3.Krishi Kalyan Cess on Expense Bills
4.Excise and Vat on Goods not used in Production like Office Expenses
Since no Input is available of these 3,we do not make their Input accounts
EXCISE ENTRIES ASSIGNMENT
Details of Purchases
Purchase Raw Material
| A LTD | |
| Particulars | Amount |
| Purchase | 96000 |
| Excise 12.5% | 12000 |
| Total | 108000 |
| Vat 5% | 5400 |
| Total | 113400 |
Entry
Purchase Local 5% A/c Dr 96000
Input Excise(Cenvat on Inputs) Dr 12000
Input Vat 5% Dr 5400
To A 113400
(input of Vat and Excise is available in case of goods used for production)
Purchase Raw Material
| B LTD | |
| Particulars | Amount |
| Purchase | 32000 |
| Excise 12.5% | 4000 |
| Total | 36000 |
| CST 2% | 720 |
| Total | 36720 |
Entry
Purchase 2% Central A/c Dr 32720
Input Excise(Cenvat on Inputs) Dr 4000
To B 36720
(input of Excise is available in case of goods used for production,however no input of CST)
Purchase Packing Material
| C LTD | |
| Particulars | Amount |
| Purchase | 16000 |
| Vat 5% | 800 |
| Total | 16800 |
Entry
Purchase Local 5% A/c Dr 16000
Input Vat 5% Dr 800
To C 16800
(input of Vat and Excise is available in case of goods used for production)
Details of Office Expenses
| D LTD | |
| Particulars | Amount |
| Stationary | 6000 |
| Excise 12.5% | 750 |
| Total | 6750 |
| Vat 5% | 337.5 |
| Total | 7087.5 |
Entry
Stationary Exp Dr 7087.5
To E 7087.5
(input of Vat and Excise is NOT available in case of goods NOT used for production)
| E LTD | |
| Particulars | Amount |
| Professional Charges | 20000 |
| Service Tax @ 14% | 2800 |
| Swachh Bharat Cess @ 0.5% | 100 |
| Krishi Kalyan Cess @ 0.5% | 100 |
| Total | 23000 |
Entry
Professional Expense Dr 20200
Input Service Tax (Cenvat on Input Services) Dr 2800
To Max and Co 23000
(No Input of both KKC and Swachh Bharat Cess for Excise Manufacturers)
Details of Machines
| F LTD | |
| Particulars | Amount |
| Machines(Factory) | 140000 |
| Excise 12.5% | 17500 |
| Total | 157500 |
| Vat 5% | 7875 |
| Total | 165375 |
Entry
Machine Dr 147875
Input Excise on Machines 1/2(Cenvat on Capital Goods Current Year) 8750
Input Excise on Machines 1/2 Deffered (Cenvat on Capital Goods Deferred) 8750
To H 165375
(Excise on Machines is available in 2 Years ,1/2 every year)
(Assuming Input of Vat on Machines is not available in State like Harayana)
OR
Machine Dr 140000
Input Excise on Machines 1/2(Cenvat on Capital Goods Current Year) 8750
Input Excise on Machines 1/2 Deffered (Cenvat on Capital Goods Deferred) 8750
Input Vat on Machines 1/3 ( Capital Goods Current Year)2625
Input Vat on Machines 2/3 ( Capital Goods Defered) 5250
To H 165375
(Assuming Input of Vat on Machines is available in State like Delhi where it is available in 3 years 1/3 every year)
| I LTD | |
| Particulars | Amount |
| Machines(Office) | 35000 |
| Excise 12.5% | 4375 |
| Total | 39375 |
| Vat 5% | 1968.75 |
| Total | 41343.75 |
Entry
Machine Dr 41343.75
To I LTD 41343.75
(Since Machine used in office and not for production,no input in this case)
Sales Finished Goods
| XLTD | |
| Particulars | Amount |
| Sales (Bottles) | 600000 |
| Excise 12.5% | 75000 |
| Total | 675000 |
| Vat 5% | 33750 |
| Total | 708750 |
Entry
X Dr 708750
To Sales (Bottles) 600000
To Output ED (Bottles) 12.5% 75000
To Output Vat 5% 33750
(For every item manufactured,separate sales and output ed a/c is preferred)
Sales Scrap
| Y LTD | |
| Particulars | Amount |
| Sales | 80000 |
| Excise | 10000 |
| Total | 90000 |
| Vat 5% | 4500 |
| Total | 94500 |
Entry
Y Dr 94500
To Sales (Scrap) 80000
To Output ED (Scrap) 12.5% 10000
To Output Vat 5% 4500
(For every item manufactured,separate sales and output ed a/c is preferred)
ADJUSTMENT ENTRY FOR OUTPUT AND INPUT ED
View Answer
OUTPUT ED (Bottles) Dr 75000
OUTPUT ED (Scrap) Dr 10000
To Input Excise(Cenvat on Inputs) Dr 16000
To Input Service Tax (Cenvat on Input Services) Dr 8750
To Input Excise on Machines 1/2(Cenvat on Capital Goods Current Year) 2800
To ED Payable 57450
What is Vat Payable?
View Answer
Output Vat 5% Der 38250
To Input Vat 5% Dr 6200
To Input Vat on Machines 1/3 ( Capital Goods Current Year)2625
To Vat Payable 32050
Question:-
Suppose Company had a Balance of 20000 in PLA Account
It Deposited 40000 more
Pass Entries
PLA DR 40000
To Bank 40000
(PLA IS A CURRENT ASSET IN TALLY HAVING OPENING BALANCE OF 20000)
ED PAYABLE Dr 57450
To PLA 57450
What is the Balance left after adjusting Excise Duty Payable
(Balance left in PLA=20000+40000-57450=2550)
