Answer to Question #237625 in Accounting for neshay

Question

The legal firm, SA Attorneys is registered as a VAT vendor. VAT is charged at 15%. On 27 March 2020, the partners approved the sponsorship of the tuition fees of a newly registered legal student from a rural area. An amount of R6 900 for the first semester tuition fees was paid to SA University via an EFT. The account(s) debited and the account(s) credited in the general ledger will be: 

Answer 1

Accounts to debited are;

Dr Tuition fees expense R5,865

Dr 15% VAT expense R1,035

Account to be credited is;

Cr Bank R6,900