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Question
A shopkeeper sells an article at its marked price (Rs. 7,500) and charges sales-tax at the rate of 12% from the customer. If the shopkeeper pays a VAT of Rs. 180; calculate the price (inclusive of tax) paid by the shopkeeper.
Solution
Since, the shopkeeper sells the articles ₹ 7,500 and charges sales-tax at the rate of 12 %.
∴ Tax charged by the shopkeeper = 12% of ₹ 7,500
= `(12)/(100) xx ₹7,500`
= ₹ 900
∵ VAT = Tax charged - Tax paid
⇒ ₹ 180 = ₹ 900 - Tax paid
⇒ Tax paid by the shopkeeper
= ₹ 900 - ₹ 180
= ₹ 720
If the shopkeeper buys the article for x Tax on it = 12% of ₹ x = ₹ 720
⇒ `(12)/(100) xx ₹ x = ₹720`
⇒ x = ₹ 6,000
∴ The price (inclusive of tax) paid by the shopkeeper
= ₹ 6,000 + ₹ 720
= ₹ 6,720
Alternatively:
The price (inclusive of tax) paid by the shopkeeper
= ₹ 6,000 + 12% of ₹ 6,000
= ₹ 6,000 + ₹ 720
= ₹ 6,720
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