An Explanation of Types of Calculation

As Additional Excise

In the Indian sub-continent, a manufacturing tax, or Excise is levied. For some products, a supplementary levy on the 'Basic Excise Duty' is charged, or 'Additional Excise Duty'. This is a surcharge calculation. For example, an Additional Excise Duty of 10% on the Basic Duty. While the calculation method is identical to 'As Surcharge' (see below), the result is to provide a 'Total Excise Payable' calculation accurately during Invoice printing.

As a Flat Rate

When you wish to specify a standard mark-up/down on an invoice. For example, 100.00 for every invoice, independent of the qty/value of the invoice.

As Surcharge

When you wish to calculate the value based on the immediately preceding figure. For example, a Sales Tax of 10% is applicable on an invoice, which would be calculated on the value of goods sold. On this, a 'Surcharge' of 5% - i.e. 5% of the Sales Tax value is applicable.

As Total Amount Rounding

Typically, the last line in an invoice. You would need to create an account which would carry the 'rounding difference'. Now, as the other values of the invoice are calculated, this account would automatically get adjusted to keep the Total Invoice Value to the desired rounding limits. Normally, you would also mark this invoice as 'Remove if Zero ? Yes', so that the account head is not retained in the invoice print-outs if no rounding was applicable.

As User Defined Value

This allows you to specify a value while creating the invoice itself. Normally, you would use this when the basis of calculation is neither Value nor Qty dependent, and therefore, needs to be entered every time you create an invoice.

Based on Quantity

In case of calculations based on the 'Total Qty' supplied. For example, you may have Freight or Forwarding charges as 2.00/Kg, and if the total qty supplied in the invoice is 200.000 Kg, then the amount should become 400.00. The 'Value Basis' will also need to be provided as '2.00/Kg' or '0.50/Pc' as the case may be.

On Current Sub Total

In certain environments, taxes are applicable on the Total Goods Value as well as supplementary charges such as 'Excise Duty', 'Packing Charges' etc. Normally, when the tax calculation method is specified as 'On Total Sales' (see below), the calculations are based on the Total Goods Value only. When you wish the supplementary charges to be included, then you would set 'On Current Sub Total' as the type of calculation.

On Item Rate

Typically used for both VAT as well as Excise Duty style calculations. Here, you would have specified the Rate of Tax applicable for each Stock Item, and you would want only those items to be used for calculation purposes which equals this Rate of Tax. The advantage is to be able to mix multiple Tax Rate products in the same Invoice, and yet get the correct ones picked up for each Tax bracket.

On Total Sales

The most common basis of Tax Calculation is on the total value of goods/services. This method would calculate using the sum of Stock Items used in the invoice.