VALUE ADDED TAX COMPUTATIONS

The following terms are interchangeable. VAT Input means VAP Paid, VAT Output means VAT
Collected.

The following are the transactions of Starlite Traders for the month of August 2022. The business is
registered for value added tax (VAT) purposes

Additional information:

1. The reported sales to unregistered customers include goods sold to a customer in South Sudan of
Sh.536, 000. 2. An invoice of Sh.160, 000 issued to Wema Traders has been omitted from the records
during the month. 3. Motor vehicle fuel and repairs and maintenance relates to the van used to supply
goods to customers. 4. Water bill related to the water supplied by the county government during the
month. All transactions are inclusive of value added tax (VAT) at the standard rate of 16% where
applicable.

Required: A value added tax (VAT) account for the month of August 2022 for Starlite Traders.

Solved

VAT VAT
The Item rate VAT Paid Collected
Sales to unregistered customers(2,337,480-536,000) 16/116 0 248,480
Sales to registered customers 5,939,483 16/116 0 819,239
Purchases from VAT registered suppliers 3,617,924 16/116 499,024 0
Purchases from VAT unregistered suppliers 1,780,020 16/116 245520 0
Electricity 204,450 16/116 28200 0
Printing and stationery 66,700 16/116 9200 0
Motor vehicle parking charges 42,050 16/116 5800 0
Legal fees 133,400 16/116 18400 0
 An invoice of Sh.160,000 issued to Wema Traders 16/116 22068.96552 0
VAT CLAIM( VAT COLLECTED 239,506
TOTAL 1,067,719 1,067,719

A value added tax (VAT) account for the month of August 2022 for Starlite Traders =239,506