Question

A retailer buys a TV from a manufacturer for ₹ 25,000. He marks the price of the TV 20% above his cost price and sells it to a consumer at 10% discount on the marked price. If the sales are inter-state and rate of GST is 12%, find:

1. the marked price of the TV.
2. consumer’s cost price of TV inclusive of tax under GST.
3. GST paid by the retailer to the Central and State Governments.

Answer 1

i. C.P of a TV for retailer = ₹ 25000

M.P of TV = C.P + 20% of C.P

= ₹ 25000 + 20% of ₹ 25000

= `₹ 25000 + 20/100 xx 25000`

= ₹ 30000

ii. Consumer's cost price = M.P - Discount

= ₹ 30000 - 10% of ₹ 30000

= `₹ 30000 - 10/100 xx 30000`

= ₹ 30000 - ₹ 3000

= ₹ 27000

Rate of GST = 12%

Consumer's cost price of TV inclusive of Tax = ₹ 27000 + 12% of ₹ 27000

= `₹ 27000 + 12/100 xx 27000`

= ₹ 27000 + 3240

= ₹ 30240

iii. Transaction is inter-state.

∴ IGST = Output IGST - Input IGST

= 12% of ₹ 27000 - 12% of ₹ 25000

= `12/100 xx 27000 - 12/100 xx 25000`

= ₹ 3240 - ₹ 3000

= ₹ 240