How to record VAT in the cash book
The VAT column is only for cash sales and cash purchases. See why money from a credit customer never goes in it.
Task 1A cash sale with VAT4 questions
A cash sale is a sale that is paid for at once, not on credit. No invoice went through the sales day book, so the cash book is the first place the VAT is recorded.
The money received is the gross amount. With VAT at 20%, the VAT is one sixth of the gross amount.
A customer pays Saltmarsh £360 for a shelf unit, VAT included.
Task 2Money from a credit customer2 questions
Task 3A cash purchase with VAT3 questions