VAT account help required

xHolmesyxxHolmesyx Posts: 16Registered
Hi all,

Could someone please explain how the answer for the attached question is calculated Please?

Many thanks

Chris

Comments

  • rileybrileyb Posts: 5Registered
    This is a fairly easy one.

    The VAT owing from the last quarter is £31,650. Because the question says the VAT was entered on the wrong side of the ledger, this incorrectly doubles the VAT Liability that the business owes, instead of clearing it, so from the position of the ledger, the Business now has a VAT liability of £63,300

    When you add the current VAT Liability for the quarter you get a total VAT Liability of £100,125. (£63,300 + £36,825)

    Hope this is helpful

    Bayo
    xHolmesyx
  • xHolmesyxxHolmesyx Posts: 16Registered
    Thank you! Makes sense now
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