Input CGST and SGST - 7740
Output CGST and SGST- 6500
What will be it's journal entry , leadger a/c and treatment in trading and p&l a/c also treatment in balance sheet.
Answer in detail.
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Answers
Example 1: Intra-state
Mr. X purchased goods Rs. 1,00,000 locally (intrastate)
He sold them for Rs. 1,50,000 in the same state
He paid legal consultation fees Rs. 5,000
He purchased furniture for his office for Rs. 12,000
Assuming CGST @8% and SGST@8%
The entries will be-
1 Purchase A/c ………………Dr. 1,00,000
Input CGST A/c ……………Dr. 8,000
Input SGST A/c ……… …Dr. 8,000
To Creditors A/c
1,16,000
2 Debtors A/c ………………Dr. 1,74,000
To Sales A/c 1,50,000
To Output CGST A/c 12,000
To Output SGST A/c 12,000
3 Legal fees A/c ………..……Dr. 5,000
Input CGST A/c ……………Dr. 400
Input SGST A/c ……………Dr. 400
To Bank A/c 5,800
4 Furniture A/c ………..……Dr. 12,000
Input CGST A/c ……………Dr. 960
Input SGST A/c ……………Dr. 960
To ABC Furniture Shop A/c 13,920
Total Input CGST=8,000+400+960= Rs. 9,360
Total Input SGST=8,000+400+960= Rs. 9,360
Total output CGST=12,000
Total output SGST=12,000
Therefore Net CGST payable=12,000-9,360=2,640
Net SGST payable=12,000-9,360=2,640
5 Output CGST A/c ……………Dr. 12,000
Output SGST A/c ……………Dr. 12,000
To Input CGST A/c 9,360
To Input SGST A/c 9,360
To Electronic Cash Ledger A/c 5,280
Thus due to input tax credit, tax liability of Rs. 24,000 is reduced to only Rs.5,280. Also, GST on legal fees can be used for set off against the GST payable on goods sold, which was not possible in current tax regime.
If there had been any input tax credit left it would have been carried forward to the next year.