Question

For a dealer A, the list price of an article is Rs. 9000, which he sells to dealer B at some lower price. Further, dealer B sells the same article to a customer at its list price. If the rate of GST is 18% and dealer B paid a tax, under GST, equal to Rs. 324 to the government, find the amount (inclusive of GST) paid by dealer B.

Answer 1

Let A sells to dealer B at Rs. x lower price.

According to the question,

Net Tax paid by dealer B is

⇒ Out put tax - Input Tax = Rs. 324

⇒ 18% of 9000 - 18% of (9000 - x) = 324

⇒ 1620 - 1620 + 18% of x = 324

⇒ 18% of x = 324

⇒ x = 1800

Hence, selling price of B = 9000 - 1800 = Rs. 7200

The amount (inclusive of GST) paid by dealer B

= 7200 + 18% of 7200

= 7200 + 1296

= Rs. 8496