Question

A shopkeeper buys an item at a discount of 20% which has a marked price (M.P) of Rs. 3000 and pays a sales tax at the rate of 8%. The shopkeeper sells the article to a buyer at marked price, and charges a sales tax at the rate of 10%. Find the VAT paid by the shopkeeper.

• A. Rs. 96
  
• B. Rs. 192
  
• C. Rs. 108
  
• D. Rs. 240

Answer 1

The correct option is C

Rs. 108

Marked price of the article = Rs. 3000
Discount of 20% is given on it
Sale price = (3000 - 20% of 3000)
= 3000 - 600

= Rs.2400
Adding sales tax on it, the amount paid by the shopkeeper will be
Total amount= Sale price + Sales tax
=2400 + 8% 2400
=2400 + $\frac{8}{100}\times 2400$
= 2400 + 192
Sales tax paid by shop keeper= Rs. 192
Now shopkeeper sold the article at M.P (Rs. 3000) with 10% sales tax on it.
So, tax charged by shopkeeper to customer
$=\frac{10}{100}\times 3000$
= Rs. 300
VAT paid by shopkeeper=Rs. 300 - Rs. 192 = Rs. 108