VAT paid by the shopkeeper is

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A shopkeeper bought a TV from a distributor at a discount of 25% of the listed price of ₹ 32000. The shopkeeper sells the TV to a consumer at the listed price. If the sales tax (under VAT) is 6% at every stage, then choose the correct answer from the given four options.

VAT paid by the shopkeeper is
(a) ₹ 480
(b) ₹ 1440
(c) ₹ 1920
(d) ₹ 8000

Solution:

(a) ₹ 480

Explanation:

Total VAT charged by the shopkeeper
= ₹ 32000 x \\ \frac { 6 }{ 100 }
= ₹ 1920
VAT already paid by distributor = ₹ 1440
Net VAT paid by shopkeeper
= ₹ 1920 – ₹ 1440
= ₹ 480

The cost of the TV to the consumer inclusive of tax is
(a) ₹ 8000
(b) ₹ 32000
(c) ₹ 33920
(d) none of these

Solution:

(c) ₹ 33920

Explanation:

Cost of T.V. to the consumer inclusive of VAT = ₹ 32000 + 1920
= ₹ 33920

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