Chapter 1 – Sales and Value added Tax ( Solved)

EXERCISE 1(A)

Question 1:

Rajat purchases a wrist costing Rs. 540. The rate of sales tax is 8%. Find the total amount paid
by rajat for the watch.
Solution 1:
Sale price of watch= Rs. 540
Rate of sales tax= 8%
Total amount paid by Rajat = Rs. 540 + 8% of Rs. 540
= Rs. 540 + 8
100
× 540
= Rs. 540 + Rs. 43.20
= Rs. 583.20 Ans

Question 2:

Ramesh paid Rs. 345.60 as sales tax on a purchase of Rs. 3,840. Find the rate of sales Tax.
Solution 2:
Sale price = Rs. 3,840
Sales tax paid = Rs. 345.60
∴ Rate of sales tax = sales tax
sales price
×100%
 =
345.60
3,840
×100%
= 9% Ans.

Question 3:

The price of a washing machine, inclusive of sales tax, is Rs. 13,530/-. If the sales tax is 10%,
Find its basic (cost) price.
Solution 3:
Selling price of washing machine = Rs. 13,530
Rate of sales tax = 10%
∴ Cost Price = selling price ×100
100+Rate of sales tax
 =
13530 ×100
100+10
 =
1353000
110
 = Rs. 12,300

Question 4:

Sarita purchases biscuit costing Rs. 158 on which the rate of sales tax is 6%. She also purchases
some cosmetic goods costing Rs. 354 on which the rate of sales tax is 9%. Find the total amount
to be paid be sarita.
Solution 4:
Sale price of biscuits = Rs. 158
Rate of sales tax on biscuits = 6%
Amount paid for biscuits = Rs. 158 + 6% of Rs. 158
= Rs. 158 + 6
100
×158
= Rs. 158 + Rs. 9.48
= Rs. 167.48
Sale price of cosmetic goods = Rs. 354
Rate of sales tax = 9%
Amount paid for cosmetic goods = Rs. 354 + 9% of Rs. 354
= Rs. 35 + 9
100
×354
= Rs. 354 + Rs. 31.86
= Rs. 385.86
Total amount paid by Sarita = Rs. 167.48 + Rs. 385.86
 = Rs. 553.34 Ans.

Question 5:

Hamid purchased some articles costing Rs. 5460. The shopkeeper charged sales tax at 8%. As
hamid wanted to take the articles purchased outside the state, the shopkeeper charged 3% as
central sales tax on the actual price of the articles. Find the total amount Hamid Had to pay for
the articles.
Solution 5:
Sale price of articles = Rs. 5,460
Rate of sales tax = 8%
Rate of central sales tax = 3%
Total amount paid by Hamid
= Rs. 5,460 + 8% of Rs. 5,460 + 3% of Rs. 5,460
= Rs. 5,460 + 8
100
×5,460 +
3
100
×5,460
= Rs. 5,460 + Rs. 436.80 + Rs. 163.80
= Rs. 6060.60 Ans

Question 6:

The marked price of two articles A and B together is Rs. 6,000. The sales tax on articles A is
8% and that on article B is 10%. If on selling both the articles, the total sales tax collected is Rs.
552, find the marked price of each of the articles A and B.

Solution 6:
Let the marked price of article A be Rs. x and article B be Rs. y.
The marked price of A and B together is Rs. 6,000.
⇒ x + y = 6,000 …….. (i)
The sales tax on article A is 8% and that on article B is 10%.
Also the total sales tax collected on selling both the articles is Rs. 552.
⇒ 8% of x + 10% of y = 552
⇒ 8x + 10 y = 55,200 …….. (ii)
Multiply equation (i) by 8 and subtract it from equation (ii) we get,
2 y = 7,200
⇒ y = 3,600
Substituting y = 3,600 in equation (i) we get,
x + 3,600 = 6,000
⇒ x = 2,400
The marked price of article A is Rs. 2,400 and article B is Rs. 3,600.

Question 7:

Tanya buys a leather coat costing Rs. 3,600, the rate of sales Tax being 10%. She asks the
shopkeeper to reduce the price of the coat to such an extent that she does not have to pay anything
more than Rs. 3,366 including sales tax. Calculate:
(i) The reduction needed in the cost price of the coat.
(ii) the reduction as percent.
Solution 7:
(i) Let new sale price of coat = Rs. y
Rate of sales tax = 10%
Total amount paid= Rs3,600
According to question
Y + 10% of Y = Rs. 3,366
⟹ y +
y
10
= Rs. 3,366
⟹
11y
10
= Rs. 3,366
⟹ y =
3,366 ×10
11
= Rs. 3,060
Reduction needed in the price= Rs. 3,600 − Rs. 3,060 = Rs. 540 Ans.
(ii) Reduction % = 540 ×100
3600
= 15%

Question 8:

The price of a T.V. set inclusive of sales tax of 9% is Rs. 13,407. Find its marked price. If Sales
tax is increased to 13%, how much more does the customer has to pay for the T.V.?
Solution 8:
(i) Total price paid for T.V. = Rs. 13,407
Rate of sales tax = 9%
Let sale price = Rs. y
According to question
Y + 9% of y = Rs. 13,407
⟹ y + 9y
100
= Rs. 13,407
⟹
109y
100
= Rs. 13,407
⟹ y =
13,407 ×100
109
= Rs. 12,300
If the sales is increased by 13% then 13% of 12300
= Rs. 12,300 + Rs. 1,599
= Rs. 13,899
More money paid = Rs. 13,899 – Rs. 13,407 = Rs. 492 Ans.
Question 9:
The price of an article is Rs. 8,250 which includes sales tax at 10%. Find how much more or
less does a customer pay for the article, if the sales tax on the article:
(i) increases to 15%
(ii) decreases to 6%
(iii) increases by 2%
(iv) decreases by 3%

Solution 9:

Let sale price of article = Rs. y
Total price inclusive of sales tax = Rs.8,250
Rate of sales tax = 10%
According to question
Y + 10 % of y = Rs. 8,250
⟹ y + y
100
= Rs. 8,250
⟹
11𝑌
10
= 𝑅𝑠. 8,250
⟹ y =
8,250 ×10
11
= 𝑅𝑠. 7,500
(i) New rate of sales tax = 15%
New total price = Rs. 7,500 + 15% of Rs. 7,500
= Rs. 7,500 + 15
100
×7,500
= Rs. 7,500 + Rs. 1,125 = Rs. 8,625
More money paid = Rs. 8,625 – Rs. 8,250 = Rs. 375 Ans.
(ii) New rate of sales tax = 6%
New total price= Rs. 7,500 + 6% of Rs. 7,500
= Rs. 7,500 + 6
100
×7,500
= Rs. 7,500 + Rs. 450 = Rs. 7,950
Less money paid = Rs. 8,250 – Rs. 7,950 = Rs. 300 Ans.
(iii) New rate of sales tax = (10 + 2)% = 12%
New total price = Rs. 7,500 + 12% of Rs. 7,500
= Rs. 7,500 + 12
100
×7,500
= Rs. 7,500 + Rs. 900 = Rs. 8,400
More money paid = Rs. 8,400 – Rs. 8,250 = Rs. 150 Ans.
(iv) New rate of sales tax = (10 − 3)% = 7%
New total price = Rs. 7,500 + 7% of Rs. 7,500
= Rs. 7,500 + 7
100
×7,500
= Rs. 7,500 + Rs. 525 = Rs. 8,025
Less money paid = Rs. 8,250 – Rs. 8,025 = Rs. 225 Ans.

Question 10:

A bicycle is available for Rs. 1,664 including sales tax. If the list price of the bicycle is Rs. 1,600
find:
(i) the rate of sales tax.
(ii) the price, a customer will pay for the bicycle if the sales tax is increased by 6%.
Solution 10:
Price of bicycle inclusive of sales tax = Rs. 1,664
List price of bicycle = Rs. 1,600
(i) Sales tax = Rs. 1,664 – Rs. 1,600 = Rs. 64
∴ Rate of sales tax = sales tax
sales price
×100% =
64
1,600
×100% = 4% Ans.
(ii) New rate of sales tax = (4 + 6)% = 10%
New total price = Rs. 1,600 + 10% of Rs. 1,600
= Rs. 1,600 + 10
100
×1,600
= Rs. 1,600 + Rs. 160
 = Rs. 1,760 Ans.

Question 11:

When the rate of sale – tax is decreased from 9% to 6% for a coloured T.V; mrs. Geeta will save
Rs. 780 in buying this T.V. Find the list price of the T.V.
Solution 11:
Let the list price of T.V. = y
Sales tax when the rate is 9% =
9
100
𝑌
⟹ Sale price is y + 9𝑦
100
Sales tax when the rate is 6% =
6
100
𝑦
⟹ Sale price is y + 6
100
𝑦
Differences of sale prices
= y +
9𝑦
100
− (𝑦 +
6𝑦
100)
= y +
9𝑦
100
− y −
6𝑦
100
=
9𝑦
100
−
6𝑦
100
Savings for Geeta = 784.
Therefore, we have,
784 = 9𝑦
100
−
6𝑦
100
⟹
3𝑦
100
= 78
⟹ y =
78×100
3
⟹ y = Rs. 26,000
Thus the list price of the T.V. is Rs. 26,000 Ans.

Question 12:

A shopkeeper sells an article for Rs. 21,384 including 10% sales tax. However, the actual
rate of sales tax is 8%. Find the extra profit made by the dealer.
Solution 12:
Price of the article inclusive of sales tax = Rs. 21,384
Let y be the list price of the article
Rate of sales tax charged by the shopkeeper = 10%
According to the given statement, we have
21384 = y + y ×
10
100
⟹ y + 𝑦
10
= 21384
⟹
11𝑦
10
= 21384
⟹ y =
21384 ×10
11
⟹ y = Rs. 19440
When the sales tax is 8%, the actual sale price
= 19440 + 19440 × 8
100
= Rs. 20,995.2
Extra profit = Sale price of the article charged by shopkeeper − Actual sale price
⟹ Extra profit = Rs. 21,384 - Rs. 20.995.2 = Rs. 388.80 Ans.

EXERCISE 1(B)

Question 1:

A trader buys an unfinished article for Rs. 1,800 and spends Rs. 600 on its finishing, packing,
transportation, etc. He marks the article at such a price that will give him 20% profit. How much
will a customer pay for he article including 12% sales tax.
Solution 1:
Purchase price = Rs. 1,800
Expenditure = Rs. 600
Total price = Rs. 1,800 + Rs. 600 = Rs. 2,400
M.P. of article = Rs. 2,400 + 20% of Rs. 2400
= Rs. 2,400 + 20
100
×2,400
=Rs. 2,400 + Rs. 480 = Rs. 2,880
Cost price for customer = Rs. 2,880 + 12% of Rs. 2,880
= Rs. 2,880 + 12
100
×2,880𝑆
= Rs. 2,880 + Rs. 345.60
= Rs. 3,225.60 Ans.

Question 2:

A shopkeeper buys an article for Rs. 800 and spends Rs. 100 on its transportation, etc. He marks
the article at a certain price and then sells it for Rs. 1,287 including 10% sales tax. Find this
profit as per cent.
Solution 2:
C.P. of an article = Rs. 800
Expenditure = Rs. 100
Total C.P.= Rs. 800 + Rs. 100 = Rs. 900
Let sale price = Rs. y
Sale price inclusive of sales tax = Rs. 1,287
Rate of sales tax = 10%
Then y + 10% of y = Rs. 1,287
⟹ y + 𝑦
10
= 𝑅𝑠. 1,287
⟹
11𝑦
10
= 𝑅𝑠. 1,287
⟹ y = Rs. 1,287 ×10
11
= 𝑅𝑠. 1,170
His profit = Rs. 1,170 – Rs. 900 = Rs. 270
His profit% = 270
900
×100% = 30% Ans

Question 3:

A shopkeeper announces a discount of 15% on his goods. If the marked price of an article, in
his shop is Rs. 6,000; how much a customer has to pay for it, if the rate of sales tax is 10%?
Solution 3:
Marked price of article = Rs. 6,000
Sale price after discount = Rs. 6,000 − 15% of Rs. 6,000
= Rs. 6,000 − Rs. 900
Rs. 5,100
Rate of sales tax = 10%
Cost price for customer = Rs. 5,100 + 10% of Rs. 5,100
= Rs. 5,100 + Rs. 510
= Rs. 5,610

Question 4:

The catalogue price of a colour T.V. is Rs. 24,000. The Shopkeeper gives a discount of 8% on
the list price. He gives a further off season discount of 5% on the balance. But sales tax at 10%
is charged on the remaining amount find.
(a) the sales tax a customer has to pay.
(b) the final price he has to pay for the T.V.
Solution 4:
List price of T.V = Rs. 24,000
Discount % = 8 %
Season discount = 5%
∴ Sale price = Rs. 24,000 (1 −
8
100) (1 −
5
100)
= 24,000 ×
92
100
×
95
100
= 𝑅𝑠. 20,976
Rate of sales tax = 10%
Sales tax = Rs. 20,976 ×
10
100
= 𝑅𝑠. 2,097.60
Final price for customer = Rs. 20,976 + 10% of Rs. 20,976
= Rs. 20,976 + 10
100
× 20,976
= Rs. 20,976 + Rs. 2,097.60
= Rs. 23,073.60 Ans

Question 5:

A shopkeeper marks his goods 40% above the cost price and then allows discount of 20% find
how much will a customer pay for an article which costs the shopkeeper Rs. 200 and a sales tax
of 10% is levied on the sale price of the article. (Give your answer correct to the nearest rupee).
Solution 5:
Cost price = Rs. 200
Marked price = Rs. 200 + 40% of Rs. 200
= Rs.200 + Rs. 80 = Rs. 280
Discount = 20%
Sale price = 280 (1 −
20
100)
= 280 ×
4
5
Rate of sales tax = 10%
Price for customer = 224 + 10% of 224
 = 224 + 10
100
×224
 = 224 + 22.4
 = 246.4
 = 246 (Approx)

Question 6:

A toy is purchased for Rs. 591.36 which includes 12% rebate on the printed price and 12% sales
tax on the sale price of the toy find the printed price of the toy.
Solution 6:
Let printed price = Rs. y
Discount% = 12%
∴ Sale price = Rs. y (1 −
12
100) = y ×
88
100
= Rs.
22 y
25
Rate of sales tax = 12%
Purchase price= Rs. 591.36
According to question
Sale price + sales tax = Rs. 591.36
Rs.
22y
25
+ 12% of 22y
25
= Rs. 591.36
⟹
22y
25
+ 66y
625
= Rs. 591.36
⟹
616y
625
= Rs. 591.36
⟹ y =
591.36 ×625
616
= Rs. 600 Ans

Question 7:

The catalogue price of an article is Rs. 20,000. The dealer allows two successive discounts 15%
and 10%. If sales tax at the rate of 10% is charged on the remaining amount. Find:
(i) the sales tax amount a customer has to pay.
(ii) the final total price that customer has to pay for the article.
Solution 7:
Catalogue price = Rs. 20,000
Two successive discounts = 15% and 10%
Sale price = 20,000 (1 −
15
100) (1 −
10
100)
= 20,000 × 17
20
×
9
10
Rate of sales tax = 10%
Sales tax = 10% of 15,300
=
10
100
×15,300 = 𝑅𝑠. 1,530
Final total price = Rs. 15,300 + Rs. 1,530 = Rs. 16,830

Question 8:

A trader buys an article for Rs. 1,700 at a discount of 15% on its printed price. He raises the
printed price of the article by 20% and then sells it for Rs. 2,688 including sales tax on the new
marked price. Find:
(i) the rate of sales tax
(ii) the trader’s profit as per cent
Solution 8:
Let the printed price = Rs. y
Discount% = 15%
Cost price = Rs. 1,700
∴ list price – discount = Rs. 1,700
⟹ y – 15% of y = Rs. 1,700
⟹ y -
3𝑦
20
= 𝑅𝑠. 1,700
⟹
17𝑦
20
= 𝑅𝑠. 1,700
⟹ y = Rs. 1,700 ×20
17
= 𝑅𝑠. 2,000
New printed price = Rs. 2,000 + 20% of Rs. 2,000
= Rs. 2,000 + 20
100
×2,000
= Rs. 2,000 + Rs. 400 = Rs. 2400
Selling price inclusive of sales tax = Rs. 2,688
Sales tax = Rs. 2,688 – Rs. 2,400 = Rs. 288
(i) ∴ Rate of sales tax = sales tax
sales price
×100%
 =
288
2,400
×100% = 12%
(ii) Profit = Rs. 2,400 – Rs. 1,700 = Rs. 700
∴ Profit % = profit
cost price
×100% =
700
1,700
×100% = 41 3
17
% Ans.

Question 9:

A shopkeeper buys an article at a rebate of 20% on its marked price and then spends Rs. 300 on
its transportation, etc. If he sells the article for Rs. 4,160 (Including sales tax at the rate of 4%
of the marked price), find the shopkeeper’s profit as per cent.
Solution 9:
Sale price including sales tax = Rs. 4,160
Let sale price = Rs. y
Rate of sales tax = 4%
∴ y + 4% of y = Rs. 4160
⟹ y + y/25
= Rs. 4,160
⟹
26𝑦
25
= 𝑅𝑠. 4160
⟹ y = Rs. 4,160 ×25
26
= Rs. 4,000
Purchase price = Rs. 4,000 − 20% of Rs. 4,000
=Rs. 4,000 – Rs. 800= Rs. 3,200
Extra expense = Rs. 300
Then total cost price = Rs. 3,200 + Rs. 300 = Rs. 3,500
His profit = Rs. 4,000 – Rs. 3,500 = Rs. 500
∴ Profit% = profit
cost price
×100%
=
500
3,500
×100% =
100
7
% = 14 2
7
% Ans

Question 10:

A shopkeeper buy an article for Rs. 2,400 from a wholesaler at 20% rebate on its list price. He
marks up the list price of the article bought by 10% and then sells it for Rs. 3,498 including sales
tax on the marked up price.
Find: (i) the rate of sales tax
(ii) the shopkeeper’s profit as per cent.
Solution 10:
Let the printed price = Rs. y
Discount% = 20%
Cost price = Rs. 2,400
∴ List price – discount = Rs. 2,400
⟹ y − 20% of y = Rs. 2,400
⟹ y −
𝑦
5
= 𝑅𝑠. 2,400
=
4𝑦
5
= 𝑅𝑠. 2,400
= y = Rs. 2,400 ×5
4
= Rs. 3,000
New printed price = Rs. 3,000 + 10% of Rs. 3,000
= Rs. 3,000 + Rs. 300 = Rs. 3,300
Selling price inclusive of sales tax = Rs. 3,498
Sales tax = Rs. 3,498 – Rs. 3,300 = Rs. 198
(i) ∴ Rate of sales tax = sales tax
sales price
×100%
 =
198
3,300
×100% = 6%
 (ii) Profit = Rs. 3,300 – Rs. 2,400 = Rs. 900
 ∴ Profit% = profit
cost price
×100% =
900
2,400
×100% = 37.5% Ans.


EXERCISE 1(C)
Question 1:
A shopkeeper purchases an article for Rs. 6,200 and sells it to a customer for Rs. 8500. If the
sales tax (under VAT) is 8%; find the VAT paid by the shopkeeper.
Solution 1:
Purchase price for shopkeeper = Rs. 6,200
Sale price for shopkeeper = Rs. 8,500
Tax paid by the shopkeeper = 8% of 6,200
=
8
100
×6,200 = 𝑅𝑠. 496
Tax charged by the shopkeeper = 8% of 8,500
=
8
100
×8,500 = 𝑅𝑠. 680
Then VAT paid by the shopkeeper = Rs. 680 – Rs. 496 = Rs. 184 Ans.
Question 2:
A purchases an article for Rs. 3,600 and sells it to B for Rs. 4,800. B in turn, sells the article to
C for Rs. 5,500. If the sales tax (Under VAT) is 10%, find the V AT levied on A and B.
Solution 2:
Purchase price for A = Rs. 3,600
Tax paid by A = 10% of Rs. 3,600
=
10
100
×3,600 = 𝑅𝑠. 360
Purchase price for B = Rs. 4,800
Tax paid by B to A = 10% of Rs. 4,800
=
10
100
×4,800 = 𝑅𝑠. 480
Purchase price for C = Rs. 5,500
Tax paid by C to B = 10% of Rs. 5,500
=
10
100
×5,500 = 𝑅𝑠. 550
VAT paid by A = Rs. 480 – Rs. 360 = Rs. 120 Ans.
VAT paid by B = Rs. 550 – Rs. 480 = Rs. 70 Ans.
Question 3:
A manufacturer buys raw material for 60,000 and pays 4% tax. He sells the ready stock for Rs.
92000 and charges 12.5% tax. Find the VAT paid by the manufacturer.
 Solution 3:
Purchase price for manufacture = Rs. 60,000
Tax paid by manufacturer = 4% of Rs. 60,000
=
4
100
×60,000 = 𝑅𝑠. 2,400
Sale price for manufacturer = Rs. 92,000
Tax charged by manufacturer = 12.5% of Rs. 92,000
=
12.5
100
×92,000 = 𝑅𝑠. 11,500
VAT paid by manufacturer= Rs. 11,500 – Rs. 2,400
= Rs. 9,100 Ans.
Question 4:
The cost of an article is Rs. 6,000 to distributor. He sells it to a trader for Rs. 7,500 and
trader sells it to a customer for Rs. 8,000. If the VAT rate is 12.5%; find the VAT paid
by the
(i) Distributor
(ii) trader
Solution 4:
Cost price for distributor = Rs. 6,000
Tax paid by distributor = 12.5% of Rs. 6,000
=
12.5
100
×6000 = 𝑅𝑠. 750
Sale price for distributor = Rs. 7,500
Tax charged by distributor = 12.5% of Rs. 7,500
=
12.5
100
×7,500 = 𝑅𝑠. 937.50
VAT paid by distributor = Rs. 937.50 – Rs. 750
= Rs. 187.50 Ans.
Sale price for trader = Rs. 8,000
Tax charged by trader = 12.5% of Rs. 8,000
=
12.5
100
×8,000 = 𝑅𝑠. 1,000
VAT paid by trader = Rs. 1,000 – Rs. 937.50 = Rs. 62.50 Ans
Question 5:
The printed price of an article is Rs. 2500. A wholesaler sells it to a retailer at 20% discount
and charges sales tax at the rate of 10%. Now the retailer, in turn, sells the article to a customer
at its list price and charges the sales tax at the same rate. Find:
(i) the amount that retailer pays to the wholesaler
(ii)the VAT paid by the retailer
Solution 5:
Printed price of an article = Rs. 2,500
Sale price for wholesaler = Rs. 2,500 − 20% of Rs. 2,500
= Rs. 2,500 − 20
100
×2,500
= Rs. 2,500 – Rs. 500 = Rs. 2,000
Tax charged by wholesaler = 10% of Rs. 2,000
 =
10
100
×𝑅𝑠. 2000 = 𝑅𝑠. 200
Cost price for retailer = Rs. 2,000 + Rs. 200 = Rs. 2,200 Ans.
Tax charged by retailer = 10% of Rs. 2,500
 =
10
100
×𝑅𝑠. 2500 = 𝑅𝑠. 250
 VAT paid by retailer = Rs. 250 – Rs. 200 = Rs. 50 Ans
Question 6:
A retailer buys an article for Rs. 800 and pays the sales tax at the rate of 8%. The retailer sells
the same article to a customer for Rs. 1,000 and charges sales tax at the same rate. Find:
(i) the price paid by a customer to buy this article.
(ii) the amount of VAT paid by the retailer
Solution 6:
Cost price for retailer = Rs. 800
Sales tax paid by retailer = 8% of Rs. 800
 =
8
100
×𝑅𝑠. 800 = 𝑅𝑠. 64
Sale price for retailer = Rs. 1,000
Tax charged by retailer = 8% of Rs. 1,000
 =
8
100
×𝑅𝑠. 1,000 = 𝑅𝑠. 80
Price paid by customer = Rs. 1,000 + Rs. 80 = Rs. 1,080 Ans.
VAT paid by retailer = Rs. 80 – Rs. 64 = Rs. 16 Ans
Question 7:
A shopkeeper buys 15 identical articles for Rs. 840 and pays sales tax at the rate of 8%. He sells
6 of these articles at Rs. 65 each and charges sales tax at the same rate. Calculate the VAT paid
by the shopkeeper against the sale of these six articles.
Solution 7:
Cost price of 15 articles = Rs. 840
Then cost price of 6 articles =
840 ×6
15
= 𝑅𝑠. 336
Sales tax paid by shopkeeper for 6 articles
= 8% of Rs. 336
=
8
100
×𝑅𝑠. 336 = 𝑅𝑠. 26.88
Sale price of 6 articles= 6 x Rs. 65 = Rs. 390
Tax charged by shopkeeper = 8% of Rs. 390
=
8
100
×𝑅𝑠. 390 = 𝑅𝑠. 31.20
VAT paid by shopkeeper = Rs. 31.20 – Rs. 26.88 = Rs. 4.32 Ans
Question 8:
The marked price of an article is Rs. 900 and the rate of sales tax on it is 6%. If on selling the
article at its marked price, a retailer has to pay VAT = Rs. 4.80; Find the money paid by him
(including sales tax) for purchasing this article.
Solution 8:
Sale price of an article for retailer = Rs. 900
Tax charged by retailer = 6% of Rs. 900
=
6
100
×𝑅𝑠. 900 = 𝑅𝑠. 54
VAT paid by retailer = Rs. 4.80
∴ VAT paid = tax charged – Tax paid
⟹ Rs. 4.80 = Rs. 54 – Tax paid
⟹ Tax paid = Rs. 54 – Rs. 4.80 = Rs. 49.20
Let cost price = Rs y
∴ 6% of y = Rs. 49.20
⟹
6
100
×𝑦 = 𝑅𝑠. 49.20
⟹ y = Rs. 49.20 ×100
6
= Rs. 820
Purchase price for retailer = Rs. 820 + Rs. 49.20 = Rs. 869.20 Ans.
Question 9:
A manufacturer marks an article at Rs. 5,000. He sells this article to a wholesaler at a discount
of 25% on the marked price and the wholesaler sells it to a retailer at a discount of 15% on its
marked price. If the retailer sells the article without any discount and at each stage the sales tax
is 8%, calculate the amount of VAT paid by:
(i) the wholesaler
(ii) the retailer
Solution 9:
Marked price of an article = Rs. 5,000
Sale price for manufacturer = Rs. 5,000 − 25% of Rs. 5,000
= Rs. 5,000 −
25
100
×𝑅𝑠. 5000
= Rs. 5,000 – Rs. 1,250 = Rs. 3,750
Tax paid by wholesaler = 8% of Rs. 3,750
=
6
100
×3,750 = 𝑅𝑠. 300
Sale price for wholesaler = Rs. 5,000 − 15% of Rs. 5,000
= Rs. 5,000 −
15
100
×𝑅𝑠. 5000
= Rs. 5,000 – Rs. 750 = Rs. 4,250
Tax paid by retailer = 8% of Rs. 4,250
=
8
100
×4,250 = 𝑅𝑠. 340
Sale price for retailer = Rs. 5,000
Tax paid by customer = 8% of Rs. 5,000
=
8
100
×5,000 = 𝑅𝑠. 400
VAT paid by wholesaler = Rs. 340 – Rs. 300 = Rs. 40 Ans.
VAT paid by retailer = Rs. 400 – Rs. 340 = Rs. 60 Ans.
Question 10:
A shopkeeper buys an article at a discount of 30% and pays sales tax at the rate of 8%. The
shopkeeper, in turn, sells the article to a customer at the printed price and charges sales tax at
the same rate. If the printed price of the article is Rs. 2,500; find:
(i) the price paid by the shopkeeper
(ii) the price paid by the customer
(iii) the VAT ( value added TAX) paid by the shopkeeper.
Solution 10:
Printed price of an article = Rs. 2,500
Purchase price for shopkeeper = Rs. 2,500 − 30% of Rs. 2,500
= Rs. 2,500 −
30
100
×𝑅𝑠. 2,500
= Rs. 2,500 – Rs. 750 = Rs. 1,750
Tax paid by the shopkeeper = 8% of Rs. 1,750
=
8
100
×𝑅𝑠. 1,750 = 𝑅𝑠. 140
Price paid by shopkeeper = Rs. 1,750 + Rs. 140 = Rs. 1,890 Ans.
Sale price for shopkeeper = Rs. 2,500
Tax paid by customer = 8% of Rs. 2,500
=
8
100
×𝑅𝑠. 2,500 = 𝑅𝑠. 200
Price paid by the customer = Rs. 2,500 + Rs. 200 = Rs. 2,700 Ans.
VAT paid by the shopkeeper = Tax charged − Tax paid
= Rs. 200 – Rs. 140 = Rs. 60 Ans
Question 11:
A shopkeeper sells an article at its list price (Rs. 3,000) and charges sales tax at the rate of 12%.
If the VAT paid by the shopkeeper is Rs. 71, at what price did the shopkeeper buy the article
inclusive of sales-tax?
Solution 11:
Sale price of an article for retailer = Rs. 3,000
Tax charged by retailer = 12% of Rs. 3,000
=
12
100
×𝑅𝑠. 3,000 = 𝑅𝑠. 360
VAT paid by retailer = Rs. 72
∴ VAT paid = Tax charged – Tax paid
⟹ Rs. 72 = Rs. 360 – Tax paid
Tax paid=Rs 360 - Rs 70 = Rs. 288
Let cost price = Rs. y
∴ 12% of y = Rs. 288
⟹
12
100
×𝑦 = 𝑅𝑠. 288
⟹ y = Rs. 288 ×100
12
= 𝑅𝑠. 2,400
Purchase price for retailer = Rs. 2,400 + Rs. 288 = Rs. 2,688 Ans
Question 12:
A manufacturer marks an article for Rs. 10,000. He sells it to a wholesaler at 40% discount. The
wholesaler sells this article to a retailer at 20% discount on the marked price of the article. If
retailer sells the article to a customer at 10% discount and the rate of sales tax is 12% at each
stage, find the amount of VAT paid by the:
(i) Wholesaler
(ii) (ii) retailer
Solution 12:
Marked price of an article = Rs. 10,000
Sale price for manufacturer
= 10,000 – 40% of 10,000
= 10,000 −
40
100
×10,000
= 10,000 – 4,000
= 6,000
Tax paid by wholesaler
= 12% of 6,000
=
12
100
×6,000
= 720
Sale price for the wholesaler
= 10,000 – 20% of 10,000
= 10,000 −
20
100
×10,000
= 10,000 – 2,000
= 8,000
Tax paid by the retailer
= 12% of 8,000
=
12
100
×8,000
= 960
Sale price for the retailer
= 10,000 – 10% of 10,000
= 10,000 −
10
100
×10,000
= 10,000 – 1,000
= 9,000
Tax paid by the customer = 12% of 9,000
=
12
100
×9,000
= 1,080
VAT paid by wholesaler = Rs. 960 − Rs. 720 = Rs. 240
VAT paid by retailer = Rs. 1080 − Rs. 960 = Rs. 120.