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VAT was deposited into government account on the due date. journal entry?
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VAT was deposited into government account on the due date. journal ent...
Journal Entry for VAT Deposited into Government Account
When a business collects Value Added Tax (VAT) from its customers, it is required to deposit the same into the government account on or before the due date. The following journal entry is made to record the transaction:
Step 1: Identify the accounts affected
- Debit: VAT Payable Account
- Credit: Bank Account
Step 2: Determine the amounts
- The amount to be debited to VAT Payable Account would be the total amount of VAT collected from customers.
- The amount to be credited to Bank Account would be the same as the amount debited to VAT Payable Account.
Step 3: Record the journal entry
- Debit VAT Payable Account and credit Bank Account by the amount determined in Step 2.
For example, if a business collected $10,000 in VAT from its customers and deposited the same into the government account on the due date, the journal entry would be:
| Date | Accounts | Debit | Credit |
|---|---|---|---|
| Due Date | VAT Payable Account | $10,000 | |
| Due Date | Bank Account | $10,000 |
By making this journal entry, the business is able to record the payment of VAT to the government and reduce its VAT Payable balance accordingly.
Community Answer
VAT was deposited into government account on the due date. journal ent...
Vat account dr to cash account
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VAT was deposited into government account on the due date. journal entry?
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VAT was deposited into government account on the due date. journal entry? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about VAT was deposited into government account on the due date. journal entry? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for VAT was deposited into government account on the due date. journal entry?.
VAT was deposited into government account on the due date. journal entry? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about VAT was deposited into government account on the due date. journal entry? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for VAT was deposited into government account on the due date. journal entry?.
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