Cost of the computer to the retailer inclusive of tax is

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A wholesaler buys a computer from a manufacturer for ₹ 40000. He marks the price of the computer 20% above his cost price and sells it to a retailer at a discount of 10% on the marked price. The retailer sells the computer to a consumer at the marked price. If the rate of sales tax (under VAT) is 10% at every stage, then choose the correct answer from the given four options.

Cost of the computer to the retailer inclusive of tax is
(a) ₹47520
(b) ₹ 43200
(c) ₹ 44000
(d) none of these

Solution:

(a) ₹ 47520

Explanation:

Rate of sales tax (VAT) = 10%
Sales tax charged = ₹ 43200 x \\ \frac { 10 }{ 100 }
= ₹ 4320
Cost price of T.V. including S.T.
= ₹ 43200 + ₹ 4320
= ₹ 47520

VAT paid by the manufacturer is
(a) ₹ 4000
(b) ₹ 4320
(c) ₹ 320
(d) none of these

Solution:

(a) ₹ 4000

Explanation:

VAT paid by the manufacturer
= ₹ 40000 x \\ \frac { 10 }{ 100 }
= ₹ 4000

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