Question

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
(ii) the VAT (Value Added Tax) paid by the shopkeeper.

• A. (i) Rs. $1,890$ (ii) Rs. $2,700$ (iii) Rs. $60$
• B. (i) Rs. $1,990$ (ii) Rs. $2,600$ (iii) Rs. $60$
• C. (i) Rs. $2,163$ (ii) Rs. $2,500$ (iii) Rs. $60$
• D. (i) Rs. $2,336$ (ii) Rs. $2,400$ (iii) Rs. $60$

Answer 1

The correct option is A (i) Rs. $1,890$ (ii) Rs. $2,700$ (iii) Rs. $60$

(i)The amount paid by shopkeeper

List Price=Rs.$2500$

Discount rate$=30\%$

Discount$=30\%of2500$$=\frac{30}{100}\times 2500=Rs.750$

Then the price of the article after discount$=2500-750=Rs.1750$

Rate of sales tax$=8\%$

$\therefore$Tax paid by the shopkeeper$=8\%of1750$

$\Rightarrow \frac{8}{100}\times 1750=Rs.140$

$\therefore$ shopkeeper paid the amount =$1750+140=Rs.1890$

(ii)The shopkeeper sell the article at printed price to the customer at $6\%$ sales tax

$\therefore$ sales tax paid by the customer $=8\%of2500$$=\frac{8}{100}\times 2500=Rs.200$

Then the price paisd by the customer$=2500+200=Rs.2700$

(iii)VAT paid by the shopkeeper

VAT=tax paid by the customer-Tax paid by the shopkeeper

$VAT=200-140=Rs.60$