Purchases VAT and Discounts Flashcards
What the the purchaser receive after a sale
They will receive a sales invoice… the purchaser will call this a purchaser invoice and enter it in the purchases day book.
What is the double entry when a payment is made for an amount owed?
Debit payable account
Credit bank account
What is the credit to the bank account?
Recognising the decrease in bank funds, we have paid money to the payable
What is the debit entry to the payable account
Is to reduce the payable balance now that we have made the payment, the liability is reduced
Where will the amount be recorded when initially recording a payment to a payable?
Into the cash payments book
What should the details of quantities and amounts be agreed to ?
The purchase order, the delivery note, and the goods received note.
What are the accounting entries for a prompt payment discount?
Debit payables account with the gross amount
Credit vat account with the vat amount
Credit discounts received account with the net amount
