Sales Tax (part a) - ACCA Financial Accounting (FA) lectures
YouTube video
27 Comments
M
mohamed933·
Dear Sir,
Is the free down notes is the pamphlet of 150 pages or there is something else to be printed out?
Please advise
Kind Regards
M El-nabi
P
parvin·
Hi!! I wanted to thank you for amazing lectures, it helps me so much to understand. I wanted to know in what lecture i can see the explanation for discounts? Im having difficulties with settlment and trade discounts and their double entry :/
J
John MoffatTutor·
Discounts are dealt with in Chapters 16 and 19 (although the lectures are really supposed to be worked through in chapter order given they are a complete course for Paper FA).
B
becky·
hello tutor, thanks for the lecture. on example 2 and 3 me am getting 100.8 and 181.5. am wondering how your getting different answers.
J
John MoffatTutor·
I do not know how you got your answers because you have not shown your workings. What I show in the lecture is correct.
A
An·
wow, amazing illustration mr Moffat!
J
John MoffatTutor·
Thank you :-)
A
Abdullahi Yusuf·
dear tutor how about if i do 0.16*120=19.2(tax)
than subtract 19.2-120 =100.8(THE NET PRICE)
AND THAN IF Add the two values i get the gross figure
19.2+100.8=120
J
John MoffatTutor·
It doesn't matter how you do your workings, as long as you get the correct answer :-)
A
Abdullahi Yusuf·
thanks dear tutor
J
John MoffatTutor·
You are welcome :-)
J
John MoffatTutor·
Thank you :-)
E
Ellen·
I'm sorry, professor, but I don't understand why when calculating the inclusive tax, you suddenly add 1 point to 1.16X, 1.175X uuu
J
John MoffatTutor·
Multiplying a figure by 1.16 is the same as adding 16% to the figure. Try it yourself and check :-)
D
Dhruva·
Thank you sir,
This lecture was helpful and the sheep example given, made the whole concept easy to understand. Now I understood the sales tax perfectly. :)
J
John MoffatTutor·
That's great - thank you :-)
A
Asif·
Thanks for this important video lecture sir, I finally understand the concept of VAT.
You know I was trying another calculation, and it was messing up my answer - maybe would know the reason.
For eg 2 for instance, To find the tax exclusive price, I tried this = 120 x 0.84 [Because to find value inclusive we can add 0.16 to 1 and make it 1.16 and then multiply to get the number 120, then why not the other way be possible 1-0.16= 0.84. Use this reversed number and multiply it with 120 to find the exclusive price?). And the answer was 100.8.
The correct answer was 120/1.16 = 103.45
120/116 x100 = 103.45.
I wonder where the logic went wrong...
E
Emfa·
Because you’re saying you’re taking 0.16 from 1 to make 0.84 of 120. But the tax isn’t 0.16 of 120. It’s 0.16 of the net price which is 103.45.
A
An·
Thank you so much
K
Kok Hue·
The drawing really picasso haha,
John has a gift .
A
ARTWELL·
hello Sir!
Not your question but sales tax related. The following trans took place during Alan's first month of trading
Credit sales of $121000 exclusive of sales tax
Credit purchases of $157110 inclusive of sales tax
Cash payments to credit suppliers of $82710 inclusive of sales tax
all transactions are subject to 20% sales tax- What was Alan's sales tax account at the end of his first month of trading?
I answered : 15770 DR but answer was $1985 DR. Why was the cash payment sales tax not counted on Alan's Sales tax account because he would have separated it so he could claim it back? I know its not your question but intrigued
J
John MoffatTutor·
In future please ask this sort of question in the Ask the Tutor Forum, and not as a comment on a lecture.
The cash paid is not for extra purchases. It is payment of part of the amount for the purchases on credit. The sales tax is accounted for then the purchases were made.
J
John MoffatTutor·
yusifbayli: Thank you for the comment :-)
Y
yusifbayli·
All lessons very useful thanks for everything.
Y
yacine·
Hi,
Thanks for the lectures, they're very helpful.
I am struggling with your example as in if the tax is on the final price of the product the your example doesn't add up as 20% of 12 is 2.4 and 20% of 6 is 1.2 and so on.
Y
yacine·
Never mindI just realised this is VAT not normal tax.
Is the free down notes is the pamphlet of 150 pages or there is something else to be printed out?
Please advise
Kind Regards
M El-nabi
than subtract 19.2-120 =100.8(THE NET PRICE)
AND THAN IF Add the two values i get the gross figure
19.2+100.8=120
This lecture was helpful and the sheep example given, made the whole concept easy to understand. Now I understood the sales tax perfectly. :)
You know I was trying another calculation, and it was messing up my answer - maybe would know the reason.
For eg 2 for instance, To find the tax exclusive price, I tried this = 120 x 0.84 [Because to find value inclusive we can add 0.16 to 1 and make it 1.16 and then multiply to get the number 120, then why not the other way be possible 1-0.16= 0.84. Use this reversed number and multiply it with 120 to find the exclusive price?). And the answer was 100.8.
The correct answer was 120/1.16 = 103.45
120/116 x100 = 103.45.
I wonder where the logic went wrong...
John has a gift .
Not your question but sales tax related. The following trans took place during Alan's first month of trading
Credit sales of $121000 exclusive of sales tax
Credit purchases of $157110 inclusive of sales tax
Cash payments to credit suppliers of $82710 inclusive of sales tax
all transactions are subject to 20% sales tax- What was Alan's sales tax account at the end of his first month of trading?
I answered : 15770 DR but answer was $1985 DR. Why was the cash payment sales tax not counted on Alan's Sales tax account because he would have separated it so he could claim it back? I know its not your question but intrigued
The cash paid is not for extra purchases. It is payment of part of the amount for the purchases on credit. The sales tax is accounted for then the purchases were made.
Thanks for the lectures, they're very helpful.
I am struggling with your example as in if the tax is on the final price of the product the your example doesn't add up as 20% of 12 is 2.4 and 20% of 6 is 1.2 and so on.