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what are Journal Entry of CST
Journal Entry of CST

what are Journal Entry of CST

what are Journal Entry of CST

Central Sales Tax It is applicable if purchase of goods is made outside the state or intestate purchased.

This tax is levied on interstate sale the sale is made outside the state.It is charge by the seller from the purchaser on the net sale value ie sale price less trade discount .CST is collected by the seller is deposited in the government account .CST become a part of purchase when goods are purchased.

Take a example

A purchased Goods for cash Rs 100000 and received Trade discount @ 5% and paid CST 10%

In this case Journal Entry will be

Purchase A/c 145000

To Cash A/c      145000

(being goods purchased )

Under this case goods are purchase and CST is paid but it is not shown separately it will be added to Purchase account.

Sold to B Ltd for Rs 200000 and provide trade discount 10% and collect CST form sale for Rs 10%

B         198000

To Sale A/c       180000

To CST Collected A/c     18000

(Being goods sold and CST collected)

CSt Collected is Liability for us therefore it need to paid

Payment of central sales tax to Government of India

CST Collected A/c Dr 18000

To Bank A/c 18000

(being CST paid )

 

 

How to make ledger CST in TALLY

CST is a tax levied by center Government of india under the act 1957.As per provison of this act any transfer of goods from one state to another on accounts of sale purchase or transfer of document of title of goods between two parties is interstate sale or purchase.All such transaction are liable to pay CST.Therefore CST is applicable in the case of Interstate sale not in the case or intrastate sale or during the case of Import or export.

How Activate CST in Tally

  1. Go to gateway of tally > f11 :features and then press f3: statutory and taxes and select the required state (if not selected in company creation screen)now select type of dealer date of applicability VAT and VAT TIN no and interstate sales tax number.

To Create Ledger of Tally >Accounts info > Ledger >Single Ledger > >Create

Create ledger in Purchase CST @ 2%

  1. Name : Purchase : CST
  2. Under : Purchase Accounts
  3. Inventory Values are affected set to : YES
  4. Cost Center are applicable set to : No
  5. Activate interest calculation set to NO
  6. used Vat Tax calculation set to NO
  7. Used VAT  returns set to YES
  8. In VAT /TAX class select inter state purchases.
  9. Skip the other fields
  10. Accept the screen

Purchase CST Screen appears as follows :

To create ledger of sales CST

  1. Name : Sales CST @ @%
  2. Under sale Accounts
  3. Inventory values are affected set to YES
  4. Cost centers are applicable set to yes.
  5. Activate interest calculation set to NO
  6. used Vat Tax calculation set to NO
  7. Used VAT  returns set to YES
  8. In VAT /TAX class select inter state Sale @ 2%
  9. Skip the other fields
  10. Accept the screen.

Create CST Purcahse @2%

  1. Name : CST Purcahse @2%
  2. under : Purchase

Also See : Journal entry of VAT 

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