Question 15 Marks
A retailer buys a TV from a manufacturer for ₹ 25000 . 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 intra-state and rate of GST is 12%, find:
i. the marked price of the TV.
ii. Consumer's cost price of TV inclusive of tax (under GST).
iii. GST paid by the retailer to the Central and State Governments.
i. the marked price of the TV.
ii. Consumer's cost price of TV inclusive of tax (under GST).
iii. GST paid by the retailer to the Central and State Governments.
Answer
View full question & answer→The cost price of the TV which the retailer pays to the manufacturer $=$ ₹ 25000
i. As the retailer marks the price of TV $20 \%$ above his cost price,
$\therefore$ the marked price of the TV $=₹\left(1+\frac{20}{100}\right) \times 25000$
$=₹\left(\frac{120}{100} \times 25000\right)=₹ 30000$
ii. As the sales are intra-state and the rate of GST is $12 \%$, so GST comprises of CGST at $6 \%$ and SGST at $6 \%$
As the retailer sells the TV to a consumer at $10 \%$ discount on the marked price, selling price of the TV by the retailer $=₹\left(1-\frac{10}{100}\right) \times 30000=₹\left(\frac{9}{10} \times 30000\right)=₹ 27000$
Amount of GST collected by retailer from consumer (or paid by consumer to retailer):
CGST $=6 \%$ of $₹ 27000=₹\left(\frac{6}{10} \times 27000\right)=₹ 1620$
SGST $=6 \%$ of $₹ 27000=₹ 1620$
$\therefore$ Consumer's cost price of TV inclusive of tax (under GST)
= Cost price of TV to consumer + GST paid by consumer
= ₹27000 + CGST paid by consumer + SGST paid by consumer
= ₹ 27000 + ₹ 1620 = ₹ 1620
= ₹30240
iii. Amount of GST collected by manufacturer from retailer:
CGST $=6 \%$ of $₹ 25000=₹\left(\frac{6}{10} \times 25000\right)=₹ 1500$
SGST - $6 \%$ of ₹ $25000=₹ 1500$
Amount of input GST of the retailer:
CGST $=$ ₹ 1500 , SGST $=₹ 1500$
Amount of output GST of the retailer:
CGST = ₹1620, SGST = ₹1620
GST paid by the retailer to the Central Government
= Output CGST - input CGST
= ₹ 1620 - ₹ 1500 = ₹ 120
GST paid by the retailer to the State Government
= Output SGST - input SGST
= ₹ 1620 - ₹ 1500 = ₹ 120
$\therefore$ Total GST paid by the retailer to the Central and State Governments
= ₹ 120 + ₹ 120 = ₹ 240
i. As the retailer marks the price of TV $20 \%$ above his cost price,
$\therefore$ the marked price of the TV $=₹\left(1+\frac{20}{100}\right) \times 25000$
$=₹\left(\frac{120}{100} \times 25000\right)=₹ 30000$
ii. As the sales are intra-state and the rate of GST is $12 \%$, so GST comprises of CGST at $6 \%$ and SGST at $6 \%$
As the retailer sells the TV to a consumer at $10 \%$ discount on the marked price, selling price of the TV by the retailer $=₹\left(1-\frac{10}{100}\right) \times 30000=₹\left(\frac{9}{10} \times 30000\right)=₹ 27000$
Amount of GST collected by retailer from consumer (or paid by consumer to retailer):
CGST $=6 \%$ of $₹ 27000=₹\left(\frac{6}{10} \times 27000\right)=₹ 1620$
SGST $=6 \%$ of $₹ 27000=₹ 1620$
$\therefore$ Consumer's cost price of TV inclusive of tax (under GST)
= Cost price of TV to consumer + GST paid by consumer
= ₹27000 + CGST paid by consumer + SGST paid by consumer
= ₹ 27000 + ₹ 1620 = ₹ 1620
= ₹30240
iii. Amount of GST collected by manufacturer from retailer:
CGST $=6 \%$ of $₹ 25000=₹\left(\frac{6}{10} \times 25000\right)=₹ 1500$
SGST - $6 \%$ of ₹ $25000=₹ 1500$
Amount of input GST of the retailer:
CGST $=$ ₹ 1500 , SGST $=₹ 1500$
Amount of output GST of the retailer:
CGST = ₹1620, SGST = ₹1620
GST paid by the retailer to the Central Government
= Output CGST - input CGST
= ₹ 1620 - ₹ 1500 = ₹ 120
GST paid by the retailer to the State Government
= Output SGST - input SGST
= ₹ 1620 - ₹ 1500 = ₹ 120
$\therefore$ Total GST paid by the retailer to the Central and State Governments
= ₹ 120 + ₹ 120 = ₹ 240
