7. A manufacturer buys raw materials worth 3 8,000 paying GST at the rate of 5%. He sells the
finished product to a dealer at a profit of 25%. The GST charged for the finished product is 12%.
Find the net GST paid by the manufacturer to the government if the sale is intra-state.
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Cost price of the raw material = Rs. 3000
Selling price of the raw material = Rs. 5000
Value added by the manufacturer = 5000 - 3000 = Rs. 2000
Rate of VAT = 4%
VAT paid by the manufacturer = 4% of Rs. 2000=4/100*2000=80
4
×2000=
Selling price of the raw material = Rs. 5000
Value added by the manufacturer = 5000 - 3000 = Rs. 2000
Rate of VAT = 4%
VAT paid by the manufacturer = 4% of Rs. 2000=4/100*2000=80
4
×2000=
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