Module 6 Flashcards
What is input VAT and what do you do with it?
Debit it
From purchases
What is output vat and what do you do with it?
Credit it
From sales
Is vat in the P+L or balance sheet?
Only in the balance sheet
It isn’t an income
Sales consists of what VAT?
Output VAT
Purchases consist of what VAT?
Input VATH
What goes into the Balance Sheet?
Assets
Liabilities
Capital
What goes into the P+L
Income
Expenses
Where does accrual go?
Current liabilities in balance sheet
Where does accrued income go?
Current asset in balance sheet
If in the same year do you debit or credit accrual?
Credit accrual
Debit payment e.g rent, cash
If in the following year what do you do with accrual?
Debit accrual
Credit payment e.g cash, rent etc
If in the same year what do you do with prepayments?
Debit prepayments
Credit the payment (rent bank etc)
Credits in accrual are always from which year?
That year
Debits in accruals are always from which year?
The previous year
If in the following year what do you do with prepayments?
Credit prepayment
Debit the payment (rent bank etc)
What do you do with accruals and VAT?
Accrual adjustments will not affect the VAT
Can’t normally be reclaimed until invoice received
(Not VAT line item)
VAT registered companies means
Input vat not treated as expense as it can be reclaimed
Output vat not an income as it must be paid to HMRC
Net amount is
Amount excluding VAT
Gross amount is?
Total amount inclusive of VAT
The cost that is capitalised for a fixed assets is recorded at the?
Net amount (excluding vat)
Exception to fixed assets and vat?
Company cars, VAT can’t be reclaimed, so gross amount is capitalised (including VAT)
