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A LTD
Purchase 70000
(700 KG*100)  
 +   VAT 5% 3500
  73500

Suppose Company received a Credit Note for Turnover Discount as follows

A LTD
Turnover discount 8500
 +   VAT 5% 425
  8925

Pass entry for Purchase ,payment and Discount received

Will we issue Debit Note or Credit Note

-a-

ENTRY FOR Purchase

PUR 5% LOCAL DR 70000
INPUT VAT 5% DR 3500
                        TO A LTD 73500

DISCOUNT COMPUTATION
DISCOUNT 8500.0 
+ VAT 5%    425.0
TOTAL        8925.0

ENTRY
A LTD DR 8925
               TO Discount Received 8500.0
               To Input Vat 5% 425.0

Even though Credit Note is received,it is a debit note for us as party is debited 

(Note One Party Credit Note is Debit Note for Other Party)

-ea-

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CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 7 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .
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