Question

Case 2-20% PT G is a taxable entrepreneur (TE) that sells shoes. During the month of June 2019, PT G record shoes sales Rp. 750 million, providing charity by giving free shoes amounted Rp. 50 million (cost amount), and export Rp. 200 million. PT G also imports goods amounted Rp. 400 million, and paid several expenses and fees (subject to VATO amounted Rp. 150 million. PT G purchased Rp. 200 million raw materials from TE, and Rp. 75 million raw materials from non-TE. Instructions: Provide journals to record all transactions above, including journals related to the VAT underpaid or overpaid. Please show all your calculations. Journal without calculation will not be graded.

Answer 1

Journal Entry for the month of June 2019.

Sr.No.	Purticulers	Debit	Credit
1	Cash/Bank/Customer Account...............Dr	770 M
	To sales		700 M
	To Vat Output Account		70 M
	(Being sales made other than charity sales liable to vat @10%)
2	Charitable sales Account.............Dr	50 M
	To Purchases/COGS Account		50 M
	(Being goods distribute as charity not liable to VAT and debited directly from cost of goods sold account)
3	Cash/Bank/Customer Account...............Dr	200 M
	To Sales (Export)		200 M
	(export sales is not liable to VAT or Zero rate vat is applicable on export sales)
4	Purchase Account.........(Import)	400 M
	Input Vat	25 M
	To Cash/Bank/Supplier		425 M
	(Only 250 M is liable to VAT balance is exempt therefore vat credit available is 250 M*10%)
5	Purchase Account............Dr	200 M
	Input Vat.........................Dr	20 M
	To Cash/Bank/Supplier		220 M
	(Being purchased from local taxable entity)
6	Purchase Account.....................Dr	75 M
	To Cash/Bank/Supplier		75 M
	(Being Purchased from local Non taxable Entity)

Notes,

1.VAT on import is 10% and Vat On export Is 0%,

2.Input tax credit of vat is not available on goods which is supplied as free samples/Charity.