Question 12 Marks
A manufacturer sells a washing machine to a wholesaler for ₹ 15000. The wholesaler sells it to a trader at a profit of ₹ 1200 and the trader sells it to a consumer at a profit of ₹ 1800. If the rate of VAT is 8%, find :
(i) The amount of VAT received by the State Government on the sale of this machine from the manufacturer and the wholesaler.
(ii) The amount that the consumer pays for the machine.
(i) The amount of VAT received by the State Government on the sale of this machine from the manufacturer and the wholesaler.
(ii) The amount that the consumer pays for the machine.
Answer
View full question & answer→Total amount under VAT
$
\begin{aligned}
& =\text { ₹ } 15000+\text { ₹ } 1200+\text { ₹ } 1800 \\
& =\text { ₹ } 18000
\end{aligned}
$
(i) VAT $=8 \%$ of \text { ₹ } 18000
$
=\frac{8}{100} \times 18000=\text { ₹ } 1440
$
(ii) Consumer pays for the machine
$
\begin{aligned}
& =\text { ₹ } 18000+\text { ₹ }1440 \\
& =\text { ₹ }19440 . .
\end{aligned}
$
$
\begin{aligned}
& =\text { ₹ } 15000+\text { ₹ } 1200+\text { ₹ } 1800 \\
& =\text { ₹ } 18000
\end{aligned}
$
(i) VAT $=8 \%$ of \text { ₹ } 18000
$
=\frac{8}{100} \times 18000=\text { ₹ } 1440
$
(ii) Consumer pays for the machine
$
\begin{aligned}
& =\text { ₹ } 18000+\text { ₹ }1440 \\
& =\text { ₹ }19440 . .
\end{aligned}
$