#### Question

A shopkeeper buys 15 identical articles for Rs 840 and pays sales tax at the rate of 8%. He sells 6 of these articles at Rs 65 each and charges sales tax at the same rate. Calculate the VAT paid by the shopkeeper against the sale of these six articles.

#### Solution

Cost price of 15 articles = Rs 840

Then cost price of 6 articles = `(840 xx 6)/15` = Rs 336

Sale tax paid by shopkeeper for articles

= 8% of Rs 336

`= 8/100 xx "Rs" 336 = "Rs" 26.88`

Sale price of articles = `6 xx "Rs" 65 = "Rs" 390`

Tax charged by shopkeeper = 8% of Rs390

`= 8/100 xx "Rs" 390 = "Rs" 31.20`

VAT paid by shopkeeper = Rs 31.20 - Rs 26.88 = Rs 4.32

Is there an error in this question or solution?

Solution A Shopkeeper Buys 15 Identical Articles for Rs 840 and Pays Sales Tax at the Rate of 8%. He Sells 6 of These Articles at Rs 65 Each and Charges Sales Tax at the Same Rate. Calculate the Vat Paid by Concept: Introduction to Sales Tax and Value Added Tax.