PSR (Pty) Ltd is registered as a category A vat vendor in terms of S27 of...

 

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PSR (Pty) Ltd is registered as a category A vat vendor in terms of S27 of the VAT Act. The company publishes tax textbooks for the local and export market. The following information has been provided to you (extracts of the cash book): R R August September 200 000 1 000 000 360 000 99 500 13 500 4 750 1950 10 000 2 000 5 000 Sales - local Sales- export Purchases Fuel Stationery Water & Electricity Entertainment (Note 1) Interest on overdraft Mortgage bond 130 000 95 000 10 000 6 000 1 750 15 000 2 000 10 000 1 500 250 000 1280 5 000 2 000 70 000 1 500 250 000 R October 250 000 400 000 105 000 12 000 5 600 Life insurance for directors' Insurance payout (Note 2) Staff teas Salaries & Wages Notes: 1. The entertainment expense relates to the entertaining of current and potential customers. 1.800 16 000 Required: Calculate the VAT for the period (provide reasons where applicable). 600 5 000 2 000 500 000 1 500 250 000 2. The company received a payment from their insurers on the 16 August 2016, for books stolen from their premises on the night of 1 August 2016. The company delivery vehicle was stolen while doing the deliveries during September 2016. The insurance company paid out R70 000 on the 30 September 2016. The managing director passed away in his sleep on the 7 October 2016. The insurer paid the company R500 000 on the life policy taken on the Managing Director's life. 3. All amounts are VAT inclusive and all purchases have been made from VAT registered businesses. PSR (Pty) Ltd is registered as a category A vat vendor in terms of S27 of the VAT Act. The company publishes tax textbooks for the local and export market. The following information has been provided to you (extracts of the cash book): R R August September 200 000 1 000 000 360 000 99 500 13 500 4 750 1950 10 000 2 000 5 000 Sales - local Sales- export Purchases Fuel Stationery Water & Electricity Entertainment (Note 1) Interest on overdraft Mortgage bond 130 000 95 000 10 000 6 000 1 750 15 000 2 000 10 000 1 500 250 000 1280 5 000 2 000 70 000 1 500 250 000 R October 250 000 400 000 105 000 12 000 5 600 Life insurance for directors' Insurance payout (Note 2) Staff teas Salaries & Wages Notes: 1. The entertainment expense relates to the entertaining of current and potential customers. 1.800 16 000 Required: Calculate the VAT for the period (provide reasons where applicable). 600 5 000 2 000 500 000 1 500 250 000 2. The company received a payment from their insurers on the 16 August 2016, for books stolen from their premises on the night of 1 August 2016. The company delivery vehicle was stolen while doing the deliveries during September 2016. The insurance company paid out R70 000 on the 30 September 2016. The managing director passed away in his sleep on the 7 October 2016. The insurer paid the company R500 000 on the life policy taken on the Managing Director's life. 3. All amounts are VAT inclusive and all purchases have been made from VAT registered businesses.

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