Financial postings for AS SUCH sale of non-capital goods

This functionality is specific for India.

When non-Capital purchased goods are sold AS SUCH, the original CENVAT credit amount availed on the goods must be reversed.

The financial postings for reversal of CENVAT credit amount and AS SUCH sale of the non-Capital goods are explained with an example.

Note

The ledger accounts for each excise tax code are defined in the Posting Data for Tax Codes (tfgld0171s000) session. The Supplier Control and Customer control account are defined in the Accounts by Financial BP Group (tfacp0110m100) session.

Non-capital goods are purchased for INR 100 with Excise duty is INR16 and sold for INR120.

Step 1. On purchase of Non-Capital goods:

Debit/ Credit	Ledger Account	Amount
Debit	Purchase	INR 100
Debit	CENVAT Credit Available	INR 16
Credit	Supplier's control	INR 116

Step 2. On AS SUCH Sale of non-capital goods :

Debit/ Credit	Ledger Account	Amount
Debit	Customer Control	INR 136
Credit	CENVAT credit available (non-capital goods)	INR 16
Credit	Sales	INR 120