Cost of Sales
mikelevene
Registered Posts: 5
I have one issue with cost of sales, was wondering if someone could help clear things up.
In a recent test the business was VAT registered. Purchases was inclusive of VAT and inventory decreased by X amount.
eg. if purchases was £120,000 inclusive of VAT and inventory decreased by 2,000.
To get purchases net of VAT I would assume you take off the VAT from 120,000.
To get cost of sales would you use 120,000 before taking off the VAT then add 2,000 from the decrease in inventory to get the cost of sales?
or would you use 100,000 after taking of VAT then add 2,000 from decrease n inventory to get cost of sales?
can't seem to find a good answer in any of the books available.
In a recent test the business was VAT registered. Purchases was inclusive of VAT and inventory decreased by X amount.
eg. if purchases was £120,000 inclusive of VAT and inventory decreased by 2,000.
To get purchases net of VAT I would assume you take off the VAT from 120,000.
To get cost of sales would you use 120,000 before taking off the VAT then add 2,000 from the decrease in inventory to get the cost of sales?
or would you use 100,000 after taking of VAT then add 2,000 from decrease n inventory to get cost of sales?
can't seem to find a good answer in any of the books available.
0
Comments
-
Have you find answer?0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 12.5K For AAT students
- 323 NEW! Qualifications 2022
- 165 General Qualifications 2022 discussion
- 11 AAT Level 2 Certificate in Accounting
- 56 AAT Level 3 Diploma in Accounting
- 88 AAT Level 4 Diploma in Professional Accounting
- 8.8K For accounting professionals
- 23 coronavirus (Covid-19)
- 272 VAT
- 92 Software
- 273 Tax
- 135 Bookkeeping
- 7.2K General accounting discussion
- 200 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 345 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 582 Job postings
- 16 Who can benefit from AAT?
- 36 Where can AAT take me?
- 42 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 66 AAT membership