A manufacturing company sold an article to its distributor for ₹ 22000 including VAT. The distributor sold the article to a dealer for ₹22000 excluding tax and the dealer sold it to a consumer for ₹ 25000 plus tax (under VAT). If the rate of sales tax (under VAT) at each stage is 10%, find :
(i) the sale price of the article for the manufacturing company.
(ii) the amount of VAT paid by the dealer.
Solution:
S.P. of an article for a manufacturer = ₹ 22000 including VAT
C.P. for the distributor = ₹ 22000
Rate of VAT = 10%
S.P. for the distributor of ₹ 22000 excluding VAT
The marked price of an article is ₹7500. A shopkeeper sells the article to a consumer at the marked prices and charges sales tax at . the rate of 7%. If the shopkeeper pays a VAT of ₹105, find the price inclusive of sales tax of the article which the shopkeeper paid to the wholesaler.
Solution:
Marked price of an article = ₹7500
Rate of S.T. = 7%
