Sales Tax and VAT Questions and Lessons

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Answered on 29 Mar Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

What do you mean by sales tax?

Prashanth reddy

Tutor

For example, if you purchase a new television for Rs. 400 and live in an area where the sales tax is 7%, you would pay Rs. 28 in sales tax. Your total bill would be Rs. 428. It is important to note that sales tax is not revenue that the seller gets to keep. The seller is simply collecting the tax as part of their agreement to do business in that city or state. Every month or quarter the seller will have to prepare forms and pay in the money they collected for taxes to the state or local government.

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Answered on 29 Mar Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

What is the full form of VAT?

Prashanth reddy

Tutor

Value Added Tax:- VAT is local sales tax. It is levied and collected under state laws. VAT has replaced the earlier sales tax system.

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Answered on 29 Mar Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

What is the difference between sales tax and VAT?

Prashanth reddy

Tutor

VAT is local sales tax. It is levied and collected under state laws. VAT has replaced the earlier sales tax system.

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Answered on 09/12/2016 Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

A shopkeeper buys an article at a rebate of 30% on the printed price. He spends Rs 40 on the transportation...

Ankit Pushp

JEE/Board Maths Tutor

Let the Printed Price = Rs. P Shopkeeper buys at rebate of 30% Hence Cost price for Shopkeeper = Rs. 0.7*P Spends for transportation = Rs. 40 Now his cost price – Rs. 0.7*P + 40 Now his final selling price = Rs. 856 Sales Tax charged at 7% on Printed Price Hence Sales Tax = 0.07*P Thus Selling Price = Printed Price + Sales Tax 856 = P + 0.07P 856 = ( 1 + 0.07) * P 856 = 1.07 * P Thus, P = 856 / 1.07. P = Rs. 800 Cost Price for Shopkeeper = 0.7*P + 40 0.7 * 800 + 40 560 + 40 Rs. 600 Hence, the Profit the shopkeeper has made is 800 – 600 = Rs. 200 Thus, Profit percentage = Profit / Printed Price =200/800 =1/4 = 0.25 = 0.25 * 100 = 25%.

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Answered on 08/12/2016 Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

Kylie buys an article for Rs. 10000 and pays 7% tax. He sells the same article for Rs. 13000 and charges...

Mohamed Fatin Nizami

Tutor

For Purchase Kylie will pay 7% on 10000 = Rs. 700 On Sales, he will pay ( 9% on 13000) - 700= 1170-700= Rs. 470.

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Answered on 05/12/2016 Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

A refrigerator is marked for sale at Rs. 17600 inclusive of sales tax at the rate of 10%. Calculate the...

Chandan Singh

Math Learning In easy Way

Let the price of the refrigerator without sales tax = P. Here, the selling price S = 17600 and the rate of sales tax i.e., r = 10 S = P(1 + r/100) 1700= P(1 + 10/100) P * 11/10 = Rs. 17600 Therefore, P = 17600 × 11/10 = 1600 × 10 = Rs. 16000 Therefore, the sale tax = Selling price - Printed price = 17600 - 16000 = Rs. 1600

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Answered on 08/12/2016 Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

A retailer buys an article from the wholesaler at Rs. 80 and the wholesaler charges a sales tax at the...

Mohamed Fatin Nizami

Tutor

Price for the customer 100 + 8% VAT = 108 Input Tax for retailer = 8% on 80 = 6.4 Output Tax = 8% on (100-80) = 1.6.

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Answered on 08/12/2016 Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

A manufacturer produces a good which cost him Rs.500. He sells it to a wholesaler at a price of Rs.500...

Mohamed Fatin Nizami

Tutor

Manufacturer will pay 5% on 500 i.e., 25. Wholesaler will charge 5% on 600= 30. Retailer will charge 5% on 800 = 40. Customer will pay Rs.40 ultimately to the retailer.

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Answered on 06/12/2016 Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

If the rate of sale tax increases by 55, the selling price of an article goes up by Rs. 40. Find the...

Akshay Gupta

Math Magician

55%= Rs. 40 100%=4000/55 =Rs. 72.72.

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Answered on 03/12/2016 Tuition/Class IX-X Tuition Tuition/Class IX-X Tuition/Mathematics Sales Tax and VAT

Find the marked price of a motorbike which is bought at $ 36300 after paying a sales tax at the rate of 10%?

Abhishek Sinha

Commerce Coaching

Let the marked price be $100 hence price after sales tax is $100 +10% =$110. Therefore If the price after sales tax is $36300 , the marked price is $36300 *100/110 = $33000.

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