Example of Reporting Output Taxes for Tax Setup Options on Receivables Activities in the Tax Register and Nonrecoverable Tax Register
The following scenario illustrates the reporting difference between the Tax Register and the Nonrecoverable Tax Register for an adjustment with nonrecoverable tax.
Receivables Invoice
The following table shows the accounting entries for an Oracle Fusion Receivables invoice that has two transaction lines, each with a different tax rate.
Account |
Debit Amount |
Credit Amount |
Description |
---|---|---|---|
Receivable |
1140.00 |
||
Revenue |
600.00 |
||
Tax |
60.00 |
Tax at 10% |
|
Revenue |
400.00 |
||
Tax |
80.00 |
Tax at 20% |
Adjustments
An adjustment for -100.00 USD is made against the invoice, reducing the receivable to 1040.00 USD. Assume the following settings for the Receivables activity for this adjustment:
Receivables Activity Option |
Setting |
---|---|
GL Account Source |
Revenue on Invoice |
Tax Rate Code Source |
Invoice |
Recoverable |
Yes |
This table shows the accounting entries created as a result of this adjustment:
Account |
Debit Amount |
Credit Amount |
Description |
---|---|---|---|
Revenue |
52.63 |
Revenue at 10% |
|
Revenue |
35.09 |
Revenue at 20% |
|
Tax |
5.26 |
Tax at 10% |
|
Tax |
7.02 |
Tax at 20% |
|
Receivable |
100.00 |
A second adjustment is made against the invoice for -200.00 USD. Assume the following settings for the Receivables activity for this adjustment:
Receivables Activity Option |
Setting |
---|---|
GL Account Source |
Revenue on Invoice |
Tax Rate Code Source |
Invoice |
Recoverable |
No |
This table shows the accounting entries created as a result of this adjustment:
Account |
Debit Amount |
Credit Amount |
Description |
---|---|---|---|
Revenue |
105.26 |
Revenue at 10% |
|
Revenue |
70.18 |
Revenue at 20% |
|
Nonrecoverable Tax |
10.52 |
Tax at 10% |
|
Nonrecoverable Tax |
14.04 |
Tax at 20% |
|
Receivable |
200.00 |
Tax Register
For the 10 percent tax, the Tax Register shows:
Transaction Number |
Transaction Class |
Taxable Amount |
Tax Amount |
---|---|---|---|
Inv-Test2 |
Invoice |
600.00 |
60.00 |
Adj-1 |
Adjustment |
-52.63 |
-5.26 |
For the 20 percent tax, the Tax Register shows:
Transaction Number |
Transaction Class |
Taxable Amount |
Tax Amount |
---|---|---|---|
Inv-Test2 |
Invoice |
400.00 |
80.00 |
Adj-1 |
Adjustment |
-35.09 |
-7.02 |
Both the item lines and the adjustment that was recorded when the Recoverable setting was set to Yes are reported in the Tax Register.
Nonrecoverable Tax Register
For the 10 percent tax, the Nonrecoverable Tax Register shows:
Transaction Number |
Transaction Class |
Taxable Amount |
Tax Amount |
---|---|---|---|
Adj-2 |
Adjustment |
-105.26 |
-10.52 |
For the 20 percent tax, the Nonrecoverable Tax Register shows:
Transaction Number |
Transaction Class |
Taxable Amount |
Tax Amount |
---|---|---|---|
Adj-2 |
Adjustment |
-70.18 |
-14.04 |
Only the adjustment that was recorded when the Recoverable setting was set to No is reported in the Nonrecoverable Tax Register.