Question

A soap manufacturer is capable of selling soaps at Rs 6.36 per piece after adding the VAT at the rate of 6%. Still, he will make a profit of 20% on the sale. What is his manufacturing cost per soap ?

Answer 1

Let cost prize be x.

Now , looking into the question

then for 20 % profit SP= x+ 20x/100
= 120x/100

VAT on Selling prize = (120x/ 100) × ( 6/100)
Total Selling prize =
120x/100 + (120x/ 100) ×
( 6/100)
= (120x/100)(106/100)

(106 * 120x) / 10000 = 6.36
x=
(6.36 * 10000)/ (106*120)
= 63600/(106*120)
=Rs. 5.00