Accounting Entry Example 4: Prepayment with 5% Prorated, Nonrecoverable VAT
This scenario assumes:
-
Prepayment for 1000.00 EUR.
-
Applied regular voucher for 11960.00 EUR.
-
VAT declaration point is payment.
-
VAT Type: Prorate nonrecoverable.
Prepaid Voucher
Accrual (voucher posting):
| Description | Account | Debit | Credit |
|---|---|---|---|
|
Prepaid Expense |
122000 |
1186.20 EUR |
N/A |
|
VAT Intermediate Recoverable |
206300 |
9.80 EUR |
N/A |
|
Accounts Payable |
200000 |
N/A |
1196.00 EUR |
Payment (payment posting):
| Description | Account | Debit | Credit |
|---|---|---|---|
|
VAT Intermediate Recoverable |
206300 |
|
9.80 EUR |
|
VAT Input Recoverable |
206103 |
9.80 EUR |
N/A |
|
Accounts Payable |
200000 |
1196.00 EUR |
N/A |
|
Cash Distribution |
100001 |
N/A |
1196.00 EUR |
Applied Regular Voucher
Accrual (voucher posting):
| Description | Account | Debit | Credit |
|---|---|---|---|
|
Expense Account |
631000 |
11862.00 EUR |
N/A |
|
VAT Input Recoverable |
206103 |
98.00 EUR |
N/A |
|
Accounts Payable |
200000 |
N/A |
11960.00 EUR |
|
Prepaid Expense |
122000 |
N/A |
1186.20 EUR |
|
VAT Input Recoverable |
206103 |
N/A |
9.80 EUR |
|
Accounts Payable |
200000 |
1196.00 EUR |
N/A |
Payment to supplier for 10764.00 EUR.
Payment (payment posting):
| Description | Account | Debit | Credit |
|---|---|---|---|
|
VAT Intermediate Recoverable |
206300 |
N/A |
88.20 EUR |
|
VAT Input Recoverable |
206103 |
88.20 EUR |
N/A |
|
Accounts Payable |
200000 |
10764.00 EUR |
N/A |
|
Cash Distribution |
100001 |
N/A |
10764.00 EUR |