Sales tax and assets account
maf at chilwell.net
Thu Nov 15 18:48:26 EST 2012
On Thu 15 November 12 17:33:45 Ben Ba wrote:
> Hi dear list,
> I have troouble understanding sales tax issues.
> When I record income:Sales (106) into Assets:Cash (100) and
> Liability:SalesTax (6) as a split transaction then when the tax is due one
> needs to subsequently transfer from Assets:Cash into Liability:SalesTax the
> amount due. Which will deplete A:Cash account by another 6. This is wrong
> in my opinion because Cash on hand will be by 12 less than in reality.
> Where do I make a mistake?
Your mistake is in the initial sales transaction.
Then later on,
Assets:Cash (-6) -> Liability:Tax (-6)
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