In July year 1, a company sold goods at VAT rate with a net value of...

 

Transcribed Image Text:

In July year 1, a company sold goods at VAT rate with a net value of $200,000, goods exempt from VAT with a value of $£50,000 and goods at zero VAT rate with a net value of $25,000. The purchases in July year 1, which were all subject to VAT, were $161,000, including VAT. Assume that the rate of VAT is 15%. The difference between VAT input tax and VAT output tax is A. Dr £9,000 B. Cr £5,850 C. Cr £9,000 D. None of these In July year 1, a company sold goods at VAT rate with a net value of $200,000, goods exempt from VAT with a value of $£50,000 and goods at zero VAT rate with a net value of $25,000. The purchases in July year 1, which were all subject to VAT, were $161,000, including VAT. Assume that the rate of VAT is 15%. The difference between VAT input tax and VAT output tax is A. Dr £9,000 B. Cr £5,850 C. Cr £9,000 D. None of these

Answer rating: 100% (QA)

B5850 EXPLANATION The calculation for the difference between VAT input tax and VAT output tax is as ... View the full answer