Answer / k.kavitha

Provision entry for current Year
Income Tax A/c ----Dr
To Income Tax Payable A/c

Adjustment entry in next Year
Income tax payable---Dr
To bank A/c

Answer / gautam kumar

FOR CURRENT YEAR WHEN PROVISION MADE

(IN P & L APPROCIATION ACCOUNT)

PROFIT & LOSS ACCOUNT DR. .......
TO PROVISION FOR INCOME TAX ACCOUNT ........

FOR NEXT YEAR WHEN PAYMENT MADE.

PROVISION FOR ICOME TAX ACCOUNT DR.
TO BANK ACCOUNT

Answer / anees mt

1.At the time of Creation of provision for income tax in previous year for coming year.


Profit & Loss A/c Dr.
To Provision for Income tax
2.At the time of Actual Income Tax Calculated.


provision for Income tax A/c Dr.
To Income Tax

3.At The time of Payment .

Income Tax A/c Dr.
To Bank

Answer / mohit

Normally following entries for Income Tax puposes:
1. Deposing Advance Tax:
Advance Tax (A.Y. ____) Dr.
To Cash or Bank

2. Provision for Current Year I.Tax:
Income Tax (Expenses) Dr.
To Provision for Tax (A.Y. _____)

3. When assessment completed and refund received:
Provision for Tax (A.Y. _____) Dr.
Bank Dr.
To Advance Tax (A.Y. ____)
4. When assessment completed and some demand raised:
Provision for Tax (A.Y. _____) Dr.
To Advance Tax (A.Y. ____)
To Income Tax Additional Demand (Expenses)
Source(s):
Self

Answer / praveen.kp

1 current year
Income tax a/c dr
to provision for taxation a/c

2.next year(adjustment entry)

a)Provision for taxation a/c dr
to income tax payable a/c

b)Income tax Payable a/c Dr
to Cash a/c


Mainly there are 3 entries one is for creating provision,
and the second one is reversal of the same in next year or
month after calculating actual tax payable, and the last one
is for payment of tax to the Government authorities

Answer / sankeerthana

Kavitha pl observe my answer. According to you the amount
of Income Tax is confirmed but not paid. But according to
the question some amount was provided in the shape of
provision. It is not exact figure.it may be raised or
lowered.
sankeerthana
www.therealaccountants.com

Answer / aj

At the time of providing provision for tax the entry is(current year)
dr-tax a/c
cr-provision for tax a/c
at the time of payment (next year)
dr--provision for tax ac
cr-bank a/c

Answer / manish

Can we make entry like this in case of additional demand raised:

Additional income tax demand (ass yr)dr
To. Bank/cash cr

Answer / muhammad

For current year when provision made

(In p

Answer / sreeram

Hi Sankeerthana,

Here the provision you have created in the earlier year you
should reverse with corresponding payment.

By end of Sep 30 you know exact amount of Tax you need to
pay simply pass one more JV.

input vat, wht use in wct

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1. During the current period, ABC Ltd sold 60,000 units of product at Rs. 30 per unit. At the beginning for the period, there were 10,000 units in inventory and ABC Ltd manufactured 50,000 units during the period. The manufacturing costs and selling and administrative expenses were as follows: Total cost Number of units Unit cost Rs. Rs. Beginning inventory: Direct materials 67,000 10,000 6.70 Direct labour 1,55,000 10,000 15.50 Variable factory overhead 18,000 10,000 1.80 Fixed factory overhead 20,000 10,000 2.00 Total 2,60,000 26.00 Current period costs: Direct materials 3,50,000 50,000 7.00 Direct labour 8,10,000 50,000 16.20 Variable factory overhead 90,000 50,000 1.80 Fixed factory overhead 1,00,000 50,000 2.00 Total 13,50,000 27.00 Selling and administrative expenses: Variable 65,000 Fixed 45,000 Total 1,10,000 Instructions: 1. Prepare an income statement based on the variable costing concept. 2. Prepare an income statement based on the absorption costing concept. 3. Give the reason for the difference in the amount of income from operations in 1 and 2.

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Please explain the difference between provision and reserve?

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The following information is extracted from the audited books of accounts of a chain of food stores for the period ended 31st December 2015. Revenue Statement (Trading and Profit and Loss Account for the year ended 31st December 2015. BWP’000 BWP’000 Sales 460 Cost of good sold (220) Gross profit 240 Wages 50 Other expenses 30 (80) Net Profit 160 Note: The purchase figure included in the cost of goods sold of P255 000. Balance Sheet as at 31st December 2015 BWP’000 BWP’000 Fixed Assets 400 Current assets: Stock 80 Debtors (trade) 120 Bank 400 ----- [600] Current liabilities: Trade creditors 300 ------ [300] 300 Net Assets 700 ==== Financed by: Share capital 600 Revenue reserves 100 ------ 700 Shareholders Funds 700 ===== Required: (a) Calculate the following accounting ratios: (i) Current ratio (ii) Acid test ratio (iii) Stock turnover (in days) (iv) Debtors turnover (in days) (v) Creditors turnover (in days) (vi) Return on capital employed (ROCE) (vii) Gross profit percentage (viii) Net profit percentage (b). Give a brief comment on the performance of the company, based on the above ratios.

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What is Deferred Asset..?

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