Question

The total cost price of food in a bill is Rs.360. If 10% service charge is added and 13% VAT is added to it, find
1. Service charge amount
2. VAT amount
3. How much you need to pay to clear the bill.

Answer 1

Answer:

The amount of service charge a restaurant levies is entirely at its own discretion. Typically, 10% is charged, and it is mentioned on the menu. The service tax rate is 14%, but since restuarants provide both goods and services, the Central Government provides an abatement of 60% on the service tax to be levied by them.