Sales invoice - Invoice issued to the customer XYZ Ltd. for £1000 (Incl. VAT of £166.67), with payment term 30 days. Post journal for it.

Sure, here is the journal entry for the sales invoice:

1. Debit: Accounts Receivable (XYZ Ltd.) £1000
2. Credit: Sales Revenue £833.33
3. Credit: VAT Payable £166.67

Explanation:

• When the invoice is issued, the company recognizes an account receivable, which is a debit entry. This is the total amount that the customer owes to the company, including VAT.

• The sales revenue is credited for the amount of the sale, excluding VAT. This is the revenue that the company earns from the sale.

• The VAT payable is also credited. This is the amount of VAT that the company owes to the government. The company collects this amount from the customer and will later pay it to the government.

The payment term of 30 days means that the customer is expected to pay the invoice within 30 days. When the payment is received, the company will debit its cash account and credit its accounts receivable account.