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
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The shopkeeper will have an Input Tax Credit of Rs. 62 /- (vat on purchase 840/108%)
When he sells the goods he charges 65 each and sold 6, so total sales are 390/-
Vat collected is 390/108% = 361
390-361 = 29/-
If the shop keeper has ITC he need not pay any VAT
If he do not have ITC he needs to pay 29/- as VAT
When he sells the goods he charges 65 each and sold 6, so total sales are 390/-
Vat collected is 390/108% = 361
390-361 = 29/-
If the shop keeper has ITC he need not pay any VAT
If he do not have ITC he needs to pay 29/- as VAT
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