The following purchases and sales were made by Pepo Limited (VAT No.
!00012Y) during the first two weeks of January 2006. Prices shown are
inclusive of VAT at the standard rate of 16 percent.
P U R C H A S E S S A L E S
Unit Price per Unit Price per

Unit
Sh.
Unit
Sh.
January 1
2
5
7
10
12
100
75
–
175
1,400
1,600
10
20
50
20
50
150
1,800
1,800
1,800
1,800
2,000
There were no opening stocks at the beginning of the month.
The physical inventory confirmed that there were 25 units in stock as at 31
January 2006.
Required:
(i) The VAT account for Pepo Limited. ( 8
marks)
(ii) What are the requirements with respect to any sales made by Pepo Limited?
( 5 marks)
(iii) Specify when and how VAT computed under (i) is payable. (
3 marks)