Exercise 1

Question 1

A manufacturer sells a T.V. to a dealer for ₹18000 and the dealer sells it to a consumer at a profit of ₹1500. If the sales are intra-state and the rate of GST is 12%, find:
(i) the amount of GST paid by the dealer to the State Government.
(ii) the amount of GST received by the Central Government.
(iii) the amount of GST received by the State Government.
(iv) the amount that the consumer pays for the T.V.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Manufacturer sells the TV to dealer for ₹18000, amount of GST collected by manufacturer from dealer(or paid by dealer)

$CGST = 6$% of $18000 = (\frac{6}{100})\times18000 =$ ₹$1080$
$SGST = 6$% of $18000 = (\frac{6}{100})\times18000 =$ ₹$1080$

∴ Amount of Input GST of dealer:

$Input$ $CGST =$ ₹$1080$
$Input$ $SGST =$ ₹$1080$

Manufacturer will pay 1080 as CGST and 1080 as SGST.

Since the dealer sells the TV to a consumer at a profit of 1500, the selling price of TV by dealer (or cost price of TV to the consumer)
= $18000 + 1500 =$ ₹$19500$.

The amount of GST collected by dealer (or paid by consumer):
$CGST = 6$% of $19500 = (\frac{6}{100})\times19500 =$ ₹$1170$
$SGST = 6$% of $19500 = (\frac{6}{100})\times19500 =$ ₹$1170$

∴ Amount of output GST of dealer:

$Output$ $CGST =$ ₹$1170$
$Output$ $SGST =$ ₹$1170$

(i) Amount of GST paid by dealer to the State Government
= SGST paid by dealer to the State Government
= $Output$ $SGST - Input$ $SGST = 1170 - 1080 =$ ₹$\bold{90}$.

(ii) Amount of GST received by the Central Government:
= CGST paid by Manufacturer + CGST paid by Dealer
=$1080 + 90 =$ ₹$\bold{1170}$

(iii) Amount of GST received by the State Government:
= SGST paid by Manufacturer + SGST paid by Dealer
= $1080 + 90 =$ ₹$\bold{1170}$

(iv) The amount which the consumer pays for the TV
= Cost price of TV + CGST paid by consumer + SGST paid by consumer
= $19500 + 1170 + 1170 =$₹$\bold{21840}$

Question 2

A shopkeeper buys a camera at a discount of 20% from a wholesaler, the printed price of the camera being ₹1600. The shopkeeper sells it to a consumer at the printed price. If the sales are intra-state and the rate of GST is 12%, find:
(i) GST paid by the shopkeeper to the Central Government.
(ii) GST received by the Central Government.
(iii) GST received by the State Government.
(iv) the amount at which the consumer bought the camera.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Printed price of the camera = 1600
Rate of discount shopkeeper = 20%
Cost Price of camera for shopkeeper = $Printed$ $Price - Discount$
= $1600 - (\frac{20}{100}\times1600) =$ ₹$1280$

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Wholesaler sells the camera to shopkeeper for ₹1280, amount of GST collected by wholesaler from shopkeeper(or paid by shopkeeper)

$CGST = 6$% of $1280 = (\frac{6}{100})\times1280 =$ ₹$76.80$
$SGST = 6$% of $1280 = (\frac{6}{100})\times1280 =$ ₹$76.80$

∴ Amount of Input GST of Shopkeeper:

$Input$ $CGST =$ ₹$76.80$
$Input$ $SGST =$ ₹$76.80$

Since the Shopkeeper sells the camera to a consumer at printed price, the amount of GST collected by shopkeeper (or paid by consumer):

$CGST = 6$% of $1600 = (\frac{6}{100})\times1600 =$ ₹$96$
$SGST = 6$% of $1600 = (\frac{6}{100})\times1600 =$ ₹$96$

∴ Amount of output GST of shopkeeper:
$Output$ $CGST =$ ₹$96$
$Output$ $SGST =$ ₹$96$

(i) GST paid by shopkeeper to the Central Government
= CGST paid by shopkeeper to the Central Government
= $Output$ $CGST - Input$ $CGST = 96 - 76.80 =$ ₹$\bold{19.20}$

(ii) GST received by the Central Government:
= CGST paid by Wholesaler + CGST paid by Shopkeeper
=$76.80 + 19.20 =$ ₹$\bold{96}$

(iii) GST received by the State Government:
= SGST paid by Wholesaler + SGST paid by Shopkeeper
=$76.80 + 19.20 =$ ₹$\bold{96}$

(iv) The amount which the consumer pays for the camera
= Cost price of camera + CGST paid by consumer + SGST paid by consumer
=$1600 + 96 + 96 =$ ₹$\bold{1792}$

Question 3

A manufacturer sells a washing machine to a wholesaler for ₹15000. The wholesaler sells it to a trader at a profit of ₹1200 and the trader sells it to a consumer at a profit of ₹1800. If all the sales are intra-state and the rate of GST is 12%, find:
(i) the amount of tax (under GST) received by the State Government from the wholesaler.
(ii) the amount of tax (under GST) received by the Central Government from the trader.
(iii) the amount that the consumer pays for the machine.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Cost price of washing machine for wholesaler = ₹15000

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Manufacturer sells the washing machine to wholesaler for 1500, amount of GST collected by manufacturer from wholesaler(or paid by wholesaler)

$CGST = 6$% of $15000 = (\frac{6}{100})\times15000 =$ ₹$900$
$SGST = 6$% of $15000 = (\frac{6}{100})\times15000 =$ ₹$900$

∴ Amount of Input GST of wholesaler:

$Input$ $CGST =$ ₹$900$
$Input$ $SGST =$ ₹$900$

Since the wholesaler sells the washing machine to trader at a profit of ₹1200, the selling price of washing machine by wholesaler:
=$15000 + 1200 =$ ₹$16200$

The amount of GST collected by wholesaler (or paid by trader):
$CGST = 6$% of $16200= (\frac{6}{100})\times16200 =$ ₹$972$
$SGST = 6$% of $16200= (\frac{6}{100})\times16200 =$ ₹$972$

∴ Amount of output GST of wholesaler:

$Output$ $CGST =$ ₹$972$
$Output$ $SGST =$ ₹$972$

Note: Since Wholesaler sells the washing machine to trader, so from trader's perspective, his/her input GST will be

$CGST = 6$% of $16200= (\frac{6}{100})\times16200 =$ ₹$972$
$SGST = 6$% of $16200= (\frac{6}{100})\times16200 =$ ₹$972$

∴ Amount of input GST of trader:

$Input$ $CGST =$ ₹$972$
$Input$ $SGST =$ ₹$972$

Since the trader sells the washing machine to consumer at a profit of ₹1800, the selling price of washing machine by trader (or cost price for consumer):
=$16200 + 1800 =$ ₹$18000$

The amount of GST collected by trader (or paid by consumer):

$CGST = 6$% of $18000= (\frac{6}{100})\times18000 =$ ₹$1080$
$SGST = 6$% of $18000= (\frac{6}{100})\times18000 =$ ₹$1080$

∴ Amount of output GST of trader:

$Output$ $CGST =$ ₹$1080$
$Output$ $SGST =$ ₹$1080$

(i) the amount of tax (under GST) received by the State Government from the wholesaler.
= Output SGST of wholesaler - Input SGST of wholesaler
$972 - 900 =$ ₹$\bold{72}$

(ii) the amount of tax (under GST) received by the Central Government from the trader.
= Output CGST of trader - Input CGST of trader
=$1080 - 972 =$ ₹$\bold{108}$

(iii) The amount which the consumer pays for the washing machine
= Cost price of washing machine + CGST paid by consumer + SGST paid by consumer
=$18000 + 1080 +1080 =$ ₹$\bold{20160}$

Question 4

A dealer buys an article at a discount of 30% from the wholesaler, the marked price being ₹6000. The dealer sells it to a consumer at a discount of 10% on the marked price. If the sales are intra-state and the rate of GST is 5%, find:
(i) the amount paid by the consumer for the article.
(ii) the tax (under GST) paid by the dealer to the State Government.
(iii) the amount of tax (under GST) received by the Central Government.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Marked price of the article = ₹$6000$
Rate of discount for dealer = $30$%
Cost Price of article for dealer = $Marked$ $Price - Discount$
= $6000 - (\frac{30}{100}\times6000) =$ ₹$4200$

As the sales are intra-state and the rate of GST is 5%, so GST comprises of 2.5% as CGST and 2.5% as SGST. Wholesaler sells the camera to dealer for ₹4200, amount of GST collected by wholesaler from dealer(or paid by dealer)

$CGST = 2.5$% of $4200= (\frac{2.5}{100})\times4200 =$ ₹$105$
$SGST = 2.5$% of $4200= (\frac{2.5}{100})\times4200 =$ ₹$105$

∴ Amount of Input GST of dealer:

$Input$ $CGST =$ ₹$105$
$Input$ $SGST =$ ₹$105$

Since the dealer sells the article to consumer at a discount of 10% on marked price, the selling price of article by dealer ( or cost price for consumer):
=$Marked$ $Price - Discount$
= $6000 - (\frac{10}{100}\times6000) =$ ₹$5400$

The amount of GST collected by dealer (or paid by consumer):
$CGST = 2.5$% of $5400= (\frac{2.5}{100})\times5400 =$ ₹$135$
$SGST = 2.5$% of $5400= (\frac{2.5}{100})\times5400 =$ ₹$135$

∴ Amount of output GST of dealer:

$Output$ $CGST =$ ₹$135$
$Output$ $SGST =$ ₹$135$

(i) the amount paid by the consumer for the article.
= Cost price of article for consumer + CGST paid by consumer + SGST paid by consumer
=$5400 + 135 +135 =$ ₹$\bold{5670}$

(ii) the tax (under GST) paid by the dealer to the State Government.
= Output SGST of dealer - Input SGST of dealer
=$135 - 105 =$ ₹$\bold{30}$

(iii) the amount of tax (under GST) received by the Central Government.
= CGST paid by Wholesaler + CGST paid by dealer
=$105 + 30 =$ ₹$\bold{135}$

Question 5

The printed price of an article is ₹50000. The wholesaler allows a discount of 10% to a shopkeeper. The shopkeeper sells the article to a consumer at 4% above the marked price. If the sales are intra-state and the rate of GST is 18%, find:
(i) the amount inclusive of tax (under GST) which the shopkeeper pays for the article.
(ii) the amount paid by the consumer for the article
(iii) the amount of tax (under GST) paid by the shopkeeper to the Central Government.
(iv) the amount of tax (under GST) received by the State Government.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Marked price of the article = ₹$50000$
Rate of discount for shopkeeper = $10$%
Cost Price of article for shopkeeper = $Marked$ $Price - Discount$
= $50000 - (\frac{10}{100}\times50000) =$ ₹$45000$

As the sales are intra-state and the rate of GST is 18%, so GST comprises of 9% as CGST and 9% as SGST. Wholesaler sells the article to shopkeeper for ₹45000, amount of GST collected by wholesaler from shopkeeper(or paid by shopkeeper)

$CGST = 9$% of $45000 = (\frac{9}{100})\times45000 =$ ₹$4050$
$SGST = 9$% of $45000 = (\frac{9}{100})\times45000 =$ ₹$4050$

∴ Amount of Input GST of Shopkeeper:

$Input$ $CGST =$ ₹$4050$
$Input$ $SGST =$ ₹$4050$

Since the shopkeeper sells the article to customer at a premium of 4% on marked price, the selling price of article by shopkeeper ( or cost price for consumer):
= $Marked$ $Price + Premium$
= $50000 + (\frac{4}{100}\times50000) =$ ₹$52000$

The amount of GST collected by shopkeeper (or paid by consumer):
$CGST = 9$% of $52000 = (\frac{9}{100})\times52000 =$ ₹$4680$
$CGST = 9$% of $52000 = (\frac{9}{100})\times52000 =$ ₹$4680$

∴ Amount of output GST of Shopkeeper:

$Output$ $CGST =$ ₹$4680$
$Output$ $SGST =$ ₹$4680$

(i) the amount inclusive of tax (under GST) which the shopkeeper pays for the article.
= Cost price of article for Shopkeeper + CGST paid by shopkeeper + SGST paid by shopkeeper
= $45000 + 4050 + 4050 =$ ₹$\bold{53100}$

(ii) the amount paid by the consumer for the article.
= Cost price of article for consumer + CGST paid by consumer + SGST paid by consumer
=$52000 + 4680 + 4680 =$ ₹$\bold{61360}$

(iii) the amount of tax (under GST) paid by the shopkeeper to the Central Government.
= Output CGST of Shopkeeper - Input CGST of Shopkeeper
= $4680 - 4050 =$ ₹$\bold{630}$.

(iv) the amount of tax (under GST) received by the State Government.
= SGST paid by Wholesaler + SGST paid by Shopkeeper
= $4050 + 630 =$ ₹$\bold{4680}$.

Question 6

A retailer buys a T.V. from a wholesaler for ₹40000. He marks the price of T.V. 15% above his cost price and sells it to a consumer at 5% discount on marked price. If the sales are intra-state and the rate of GST is 12%, find:
(i) the marked price of the T.V.
(ii) the amount which the consumer pay for the T.V.
(iii) the amount of tax (under GST) paid by the retailer to the Central Government.
(iv) the amount of tax (under GST) received by the State Government.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Cost Price of T.V. for retailer = ₹$40000$
Premium percentage by retailer = $15$%
Marked price of the T.V by retailer =
= $Cost$ $Price + Premium$
= $40000 + (\frac{15}{100}\times40000) =$ ₹$46000$

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Wholesaler sells the T.V. to retailer for ₹40000, amount of GST collected by wholesaler from retailer(or paid by retailer)

$CGST = 6$% of $40000 = (\frac{6}{100})\times40000 =$ ₹$2400$
$SGST = 6$% of $40000 = (\frac{6}{100})\times40000 =$ ₹$2400$

∴ Amount of Input GST of retailer:

$Input$ $CGST =$ ₹$2400$
$Input$ $SGST =$ ₹$2400$

Since the retailer sells the T.V. to consumer at a discount of 5% on marked price, the selling price of T.V. by retailer (or cost price for consumer):
= $Marked$ $Price - Discount$
= $46000 - (\frac{5}{100}\times46000) =$ ₹$43700$

The amount of GST collected by retailer (or paid by consumer):
$CGST = 6$% of $43700 = (\frac{6}{100})\times43700 =$ ₹$2622$
$SGST = 6$% of $43700 = (\frac{6}{100})\times43700 =$ ₹$2622$

∴ Amount of output GST of retailer:

$Output$ $CGST =$ ₹$2622$
$Output$ $SGST =$ ₹$2622$

(i) the marked price of the T.V.
= ₹$\bold{46000}$

(ii) the amount which the consumer pay for the T.V.
= Cost price of T.V. for consumer + CGST paid by consumer + SGST paid by consumer
=$43700 + 2622 + 2622 =$ ₹$\bold{48944}$

(iii) the amount of tax (under GST) paid by the retailer to the Central Government.
= Output CGST of retailer - Input CGST of retailer
=$2622 - 2400 =$ ₹$\bold{222}$

(iv) the amount of tax (under GST) received by the State Government.
= SGST paid by Wholesaler + SGST paid by retailer
= $2400 + 222 =$ ₹$\bold{2622}$

Question 7

A shopkeeper buys an article from a manufacturer for ₹12000 and marks up its price by 25%, The shopkeeper gives a discount of 10% on the marked up price and he gives a further off-season discount of 5% on the balance to a customer of T.V. If the sales are intra-state and the rate of GST is 12%, find:
(i) the price inclusive of tax (under GST) which the consumer pays for the T.V.
(ii) the amount of tax (under GST) paid by the shopkeeper to the State Government.
(iii) the amount of tax (under GST) received by the Central Government.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Cost Price of T.V. for shopkeeper = ₹$12000$
Premium percentage by shopkeeper = $25$%
Marked price of the T.V by shopkeeper
= $Cost$ $Price + Premium$
= $12000 + (\frac{25}{100}\times12000) =$ ₹$15000$

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Manufacturer sells the T.V. to shopkeeper for ₹12000, amount of GST collected by manufacturer from shopkeeper(or paid by shopkeeper)

$CGST = 6$% of $12000 = (\frac{6}{100})\times12000 =$ ₹$720$
$SGST = 6$% of $12000 = (\frac{6}{100})\times12000 =$ ₹$720$

∴ Amount of Input GST of shopkeeper:

$Input$ $CGST =$ ₹$720$
$Input$ $SGST =$ ₹$720$

Since the shopkeeper sells the T.V. to consumer at a discount of 10% on marked price, and further off season discount of 5% on balance, the selling price of T.V. by shopkeeper (or cost price for consumer):
= $Balance = Marked$ $Price - Discount$
= $15000 - (\frac{10}{100}\times15000) =$ ₹$13500$

Selling Price by shopkeeper (or cost price for consumer):

= $Balance$ $Price - Off$ $season$ $discount$
= $13500 - (\frac{2}{100}\times13500) =$ ₹$12825$

The amount of GST collected by shopkeeper (or paid by consumer):
$CGST = 6$% of $12825 = (\frac{6}{100})\times12825 =$ ₹$769.50$
$SGST = 6$% of $12825 = (\frac{6}{100})\times12825 =$ ₹$769.50$

∴ Amount of output GST of shopkeeper:

$Output$ $CGST =$ ₹$769.50$
$Output$ $SGST =$ ₹$769.50$

(i) the price inclusive of tax (under GST) which the consumer pays for the T.V.
= Cost price of T.V. for consumer + CGST paid by consumer + SGST paid by consumer
=$12825 + 769.50 + 769.50 =$ ₹$\bold{14364}$

(ii) the amount of tax (under GST) paid by the shopkeeper to the State Government.
= Output SGST of shopkeeper - Input SGST of shopkeeper
=$769.50 - 720 =$ ₹$\bold{49.50}$

(iii) the amount of tax (under GST) received by the Central Government.
= CGST paid by manufacturer + CGST paid by shopkeeper
=$720 + 49.50 =$ ₹$\bold{769.50}$

Question 8

A manufacturer marks an article at ₹5000, He sells it to a wholesaler at a discount of 25% on the marked price and the wholesaler sells it to a retailer at a discount of 15% on the marked price. The retailer sells it to a consumer at the marked price. if all the sales are intra-state and the rate of GST is 12%, find:
(i) The amount inclusive of tax (under GST) which the wholesaler pays for the article.
(ii) The amount inclusive of tax (under GST) which the retailer pays for the article.
(iii) The amount of tax (under GST) which the wholesaler pays to the Central Government.
(iv) The amount of tax (under GST) which the retailer pays to the State Government.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Marked Price of article by manufacturer = ₹$5000$
Discount percentage given by manufacturer to wholesaler = $25$%
Cost Price for wholesaler = $Marked$ $Price - Discount$
= $5000 - (\frac{25}{100}\times5000) =$ ₹$3750$

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Manufacturer sells the article to wholesaler for ₹3750, amount of GST collected by manufacturer from wholesaler(or paid by wholesaler)

$CGST = 6$% of $3750 = (\frac{6}{100})\times3750 =$ ₹$225$
$SGST = 6$% of $3750 = (\frac{6}{100})\times3750 =$ ₹$225$

∴ Amount of Input GST of wholesaler:

$Input$ $CGST =$ ₹$225$
$Input$ $SGST =$ ₹$225$

Since the wholesaler sells the article to retailer at a discount of 15% on marked price, the selling price of article by wholesaler (or cost price for retailer):
= $Marked$ $Price - Discount$
= $5000 - (\frac{15}{100}\times5000) =$ ₹$4250$

The amount of GST collected by wholesaler (or paid by retailer):
$CGST = 6$% of $4250 = (\frac{6}{100})\times4250 =$ ₹$255$
$SGST = 6$% of $4250 = (\frac{6}{100})\times4250 =$ ₹$255$

∴ Amount of output GST of wholesaler(or input GST of retailer):

$Output$ $CGST =$ ₹$255$
$Output$ $SGST =$ ₹$255$

The amount of GST collected by retailer (or paid by consumer):
$CGST = 6$% of $5000 = (\frac{6}{100})\times5000 =$ ₹$300$
$SGST = 6$% of $5000 = (\frac{6}{100})\times5000 =$ ₹$300$

∴ Amount of output GST of retailer:

$Output$ $CGST =$ ₹$300$
$Output$ $SGST =$ ₹$300$

(i) The amount inclusive of tax (under GST) which the wholesaler pays for the article.
= Cost price of article for wholesaler + CGST paid by wholesaler + SGST paid by wholesaler
= $3750 + 225 + 225 =$ ₹$\bold{4200}$

(ii) The amount inclusive of tax (under GST) which the retailer pays for the article.
= Cost price of article for retailer + CGST paid by retailer + SGST paid by retailer
= $4250 + 255 + 255 =$ ₹$\bold{4760}$

(iii) The amount of tax (under GST) which the wholesaler pays to the Central Government.
= Output CGST of wholesaler - Input CGST of wholesaler
= $255 - 225=$ ₹$\bold{30}$

(iv) The amount of tax (under GST) which the retailer pays to the State Government.
= Output CGST of retailer - Input CGST of retailer
= $300 - 255=$ ₹$\bold{45}$

Question 9

The printed price of an article is Rs 40000. A wholesaler in Uttar Pradesh buys the article from a manufacturer in Gujarat at a discount of 10% on the printed price. The wholesaler sells the article to a retailer in Himachal at 5% above the printed price. If the rate of GST on the article is 18%, find:
(i) The amount inclusive of tax (under GST) paid by the wholesaler for the article.
(ii) The amount inclusive of tax (under GST) paid by the retailer for the article.
(iii) The amount of tax (under GST) paid by the wholesaler to the Central Government.
(iv) The amount of tax (under GST) received by the Central Government.

Solution

Given: The printed price of article is ₹40000. The rate of GST on sale or purchase of article is 18%. Here both the sales from manufacturer to wholesaler and wholesaler to retailer are inter-state, so IGST is levied on these sales at 18%

(i) As the wholesaler buys the article from a manufacturer at 10% discount on the printed price,

∴ Cost price of the article for the wholesaler:

Cost Price for wholesaler = $Printed$ $Price-Discount$
= $40000-(\frac{10}{100}\times40000)=$ ₹$36000$

Amount of IGST collected by manufacturer from wholesaler(or paid by wholesaler to manufacturer)
$IGST=18$% of $36000 = (\frac{18}{100})\times36000 =$ ₹$6480$

∴ Amount of Input GST of wholesaler:

$Input$ $IGST =$ ₹$6480$

The amount inclusive of tax (under GST) which the wholesaler pays for the article:
= Cost price of article for wholesaler + IGST paid by wholesaler
= $36000 + 6480=$ ₹$\bold{42480}$

(ii) As wholesaler sells the article to retailer at 5% above the printed printed price. The selling price of article by wholesaler(or cost price of article for retailer):
= $Printed$ $Price+Premium$
= $40000+(\frac{5}{100}\times40000)=$ ₹$42000$

Amount of IGST collected by wholesaler from retailer(or paid by retailer to wholesaler)
$IGST=18$% of $42000 = (\frac{18}{100})\times42000 =$ ₹$7560$

∴ Amount of Output GST of wholesaler:

$Output$ $IGST =$ ₹$7560$

The amount inclusive of tax (under GST) paid by the retailer for the article:
= Cost price of article for retailer + IGST paid by retailer
= $42000 + 7560=$ ₹$\bold{49560}$

(iii) The amount of tax (under GST) paid by the wholesaler to the Central Government:
= Output IGST of wholesaler - Input IGST of wholesaler
= $7560 - 6480 =$ ₹$\bold{1080}$.

(iv) The amount of tax (under GST) received by the Central Government:
= IGST paid by Manufacturer + IGST paid by wholesaler
= $6480 + 1080 =$ ₹$\bold{7560}$.

Question 10

A shopkeeper in Delhi buys an article at the printed price of ₹24000 from a wholesaler in Mumbai. The shopkeeper sells the article to a consumer in Delhi at a profit of 15% on the basic cost price. if the rate of GST is 12%, find:
(i) The price inclusive of tax (under GST) at which the wholesaler bought the article.
(ii) The amount which the consumer pays for the article.
(iii) The amount of tax (under GST) received by the State Government of Delhi.
(iv) The amount of tax (under GST) received by the Central Government.

Solution

(i) Given:
The printed price of article is ₹24000. The rate of GST on sale or purchase of article is 15%. Here the sales from wholesaler to shopkeeper is inter-state, so IGST is levied on that sale at 12%.

Amount of IGST collected by wholesaler from shopkeeper(or paid by shopkeeper to wholesaler)
$IGST=12$% of $24000 = (\frac{12}{100})\times24000 =$ ₹$2880$

∴ Amount of Input IGST of shopkeeper:

$Input$ $IGST =$ ₹$2880$

The amount inclusive of tax (under GST) at which the wholesaler bought the article:
= Cost price of article for wholesaler + IGST paid by wholesaler
= $24000 + 2880=$ ₹$\bold{26880}$

(ii) As shopkeeper sells the article to consumer at 15% above the basic cost price. The selling price of article by shopkeeper(or cost price of article for consumer):
= $Cost$ $Price+Premium$
= $24000+(\frac{15}{100}\times24000)=$ ₹$27600$

As the shopkeeper sells the article to consumer in Delhi, so the sale is intra - state

∴ GST will be applied which as CGST at 6% and SGST at 6%.

The amount of GST collected by shopkeeper (or paid by consumer):
$CGST = 6\%\space of\space 27600 = (\frac{6}{100})\times27600 =$ ₹$1656$
$SGST = 6\%\space of\space 27600 = (\frac{6}{100})\times27600 =$ ₹$1656$

∴ Amount of Output GST of shopkeeper:

$Output$ $CGST =$ ₹$1656$
$Output$ $SGST =$ ₹$1656$

The amount which the consumer pays for the article: = Cost price of article for consumer + CGST paid by consumer + SGST paid by consumer
= $27600 + 1656 + 1656 =$ ₹$\bold{30912}$

(iii) Since the transactions include both IGST and GST we need to apply input GST credit rules:

First set off Input IGST against Output CGST:

Balance Input IGST = Input IGST - Output CGST
= $2880 - 1656 =$ ₹$1224$

Then set off Balance Input IGST against output SGST

∴ The amount of tax (under GST) received by the State Government of Delhi:

Output SGST - Balance Input IGST
= $1656 - 1224 =$ ₹$\bold{432}$

(iv) The amount of tax (under GST) received by the Central Government.
= IGST received from wholesaler + CGST received from shopkeeper = $2880 + 0 =$ ₹$\bold{2880}$

Question 11

Kiran purchases an article for Rs 5310 which includes 10% rebate on the marked price and 18% tax (under GST) on the remaining price. Find the marked price of the article.

Solution

Given:
Rate of GST = $18$%
Rebate(or discount) = $10$% on Marked Price

Let the marked price be be P
Cost price of the article = $Marked$ $Price -Discount$
= $P - 10$% $of$ $P$
= $P - (\frac{10}{100}) \times P$
= $(\frac{90P}{100})$
=$0.9P$

Amount of GST on cost price of article = $18$% $of$ $0.9P$

Amount paid by Kiran = $Cost$ $Price + GST$ = $5310$
=$0.9P+(\frac{18}{100}\times0.9P)$ = $5310$
=$0.9P+ 0.162P$ = $5310$
= $1.062P$ = $5310$
= $P = \frac{5310}{1.062}$ =₹$\bold{5000}$

Question 12

A Shopkeeper buys an article whose list price is ₹8000 at some rate of discount from the wholesaler. He sells the article to a consumer at the list price. The sales are intra-state and the rate of GST is 18%. If the shopkeeper pays a tax (under GST) of ₹72 to the State Government, find the rate of discount at which he bought the article from the wholesaler.

Solution

Given:
List Price of the Article = ₹8000
Let discount rate be $x$%

Cost price of article for shopkeeper = $List$ $Price - Discount$
= $8000-(\frac{x}{100}\times8000)$
= $8000 - 80x$

As the sales are intra-state and the rate of GST is 18%, so GST comprises of 9% as CGST and 9% as SGST. wholesaler sells the article to shopkeeper for $8000 - 80x$, amount of GST collected by wholesaler from shopkeeper(or paid by shopkeeper)

$CGST = 9$ % of $(8000 - 80x) = (\frac{9}{100})\times(8000 - 80x) = (720 - 7.2x)$
$SGST = 9$ % of $(8000 - 80x) = (\frac{9}{100})\times(8000 - 80x) = (720 - 7.2x)$

∴ Amount of Input GST of shopkeeper:

$Input$ $CGST = 720 - 7.2x$
$Input$ $SGST = 720 - 7.2x$

Cost Price for Consumer = List Price of the article (as given in question) = $8000$

The amount of GST collected by shopkeeper (or paid by consumer):
$CGST = 9$% of $8000 = (\frac{9}{100})\times8000 =$₹$720$
$SGST = 9$% of $8000 = (\frac{9}{100})\times8000 =$₹$720$

∴ Amount of Output GST of shopkeeper:

$Output$ $CGST =$ ₹$720$
$Output$ $SGST =$ ₹$720$

As the shopkeeper pays a tax (under GST) of ₹72 to the State Government:

Tax paid to state government by shopkeeper:
= Output SGST of shopkeeper - Input SGST of shopkeeper = ₹72
= $720 - (720 - 7.2x) = 72$.
= $7.2x = 72$
= $x=\frac{72}{7.2} =\bold{10}$%

Multiple Choice Questions

A retailer purchases a fan for ₹1500 from a wholesaler and sells it to a consumer at 10% profit. If the sales are intra-state and the rate of GST is 12%, then choose the correct answer from the given four options for question 1 to 6:

Question 1

The selling price of the fan by the retailer (excluding tax) is

(a) ₹1500
(b) ₹1650 ✓
(c) ₹1848
(d) ₹1800

Solution

Given:

Cost price for retailer = ₹$1500$
Profit % of retailer on cost price = $10$%

∴ selling price of the fan by retailer(excluding tax):
= $Cost$ $Price+Profit$
= $1500+10$ % of $1500 = 1500+ ((\frac{10}{100})\times1500)$
= $1500+ 150=$ ₹$\bold{1650}$

Question 2

The selling price of the fan including tax(under GST) by the retailer is

(a) ₹1650
(b) ₹1800
(c) ₹1848 ✓
(d) ₹1830

Solution

From Question 1:
Selling price of the fan for retailer or cost price of the article for consumer = ₹1650

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Retailer sells the fan to consumer for ₹1650, amount of GST collected by retailer from consumer(or paid by consumer):

$CGST = 6$% of $1650 = (\frac{6}{100})\times1650 =$₹$99$
$SGST = 6$% of $1650 = (\frac{6}{100})\times1650 =$₹$99$

∴ The Output Tax(under GST) for retailer:
$Output$ $CGST = 99$
$Outpur$ $SGST = 99$

∴ The selling price of the fan including tax(under GST) by the retailer is

= Cost price of fan for consumer + CGST paid by consumer + SGST paid by consumer
= $1650 + 99+99=$ ₹$\bold{1848}$

Question 3

The tax (under GST) paid by the wholesaler to the Central Government is

(a) ₹90 ✓
(b) ₹9
(c) ₹99
(d) ₹180

Solution

Given:

Selling price(excluding tax) for wholesaler = $1500$

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Wholesaler sells the fan to retailer for ₹1500, amount of GST collected by wholesaler from retailer(or paid by retailer):

$CGST = 6$% of $1500 = (\frac{6}{100})\times1500 =$₹$90$
$SGST = 6$% of $1500 = (\frac{6}{100})\times1500 =$₹$90$

∴ The Input Tax(under GST) for retailer:
$Input$ $CGST = 90$
$Input$ $SGST = 90$

∴ The tax (under GST) paid by the wholesaler to the Central Government is
$=CGST$ = ₹$\bold{90}$

Question 4

The tax (under GST) paid by the retailer to the State Government is

(a) ₹99
(b) ₹9 ✓
(c) ₹18
(d) ₹198

Solution

From Question 1 and Question 3:

For Retailer:
$Input$ $SGST = 90$
$Output$ $SGST = 99$

The tax (under GST) paid by the retailer to the State Government is

Output SGST - Input SGST
= $99 - 90 =$ ₹$\bold{9}$

Question 5

The tax (under GST) received by the Central Government is

(a) ₹18
(b) ₹198
(c) ₹90
(d) ₹99 ✓

Solution

From Question 3:
The tax (under GST) paid by the wholesaler to the Central Government is = ₹$90$

From Question 4:
The tax (under GST) paid by the retailer to the State Government is = ₹$9$

as CGST = SGST
∴ The tax (under GST) paid by the retailer to the Central Government is = ₹$9$

The tax (under GST) received by the Central Government is
= CGST paid by the wholesaler + CGST paid by the retailer
= $90 + 9 =$ ₹$\bold{99}$

Question 6

The cost of fan to the consumer including of tax is

(a) ₹1650
(b) ₹1800
(c) ₹1830
(d) ₹1848 ✓

Solution

From Question 1:
Selling price of the fan for retailer or cost price of the article for consumer = ₹1650

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Retailer sells the fan to consumer for ₹1650, amount of GST collected by retailer from consumer(or paid by consumer):

$CGST = 6$% of $1650 = (\frac{6}{100})\times1650 =$₹$99$
$SGST = 6$% of $1650 = (\frac{6}{100})\times1650 =$₹$99$

∴ The cost of fan to the consumer including of tax is

= Cost price of fan for consumer + CGST paid by consumer + SGST paid by consumer
= $1650 + 99+99=$ ₹$\bold{1848}$

A shopkeeper bought a TV from a distributor at a discount of 25% of the listed price of ₹32000. The shopkeeper sells te TV to a consumer at listed price. If the sales are intra-state and the rate of GST is 18%, then choose the correct answer from the given four options for questions 7 to 11:

Question 7

The selling price of TV including tax(under GST) by the distributor is

(a) ₹32000
(b) ₹24000
(c) ₹28320 ✓
(d) ₹26160

Solution

Given:
Listed price of TV =₹$32000$
Discount given by distributor to shopkeeper = $25$% of Listed price:
= $(\frac{25}{100})\times32000 =$₹$8000$

Selling price for distributer excluding tax(or cost price for shopkeeper) = $Listed$ $Price-Discount$
= $32000-8000$ = ₹$24000$

As the sales are intra-state and the rate of GST is 18%, so GST comprises of 9% as CGST and 9% as SGST. Distributor sells the TV to shopkeeper for ₹24000, amount of GST collected by distributor from shopkeeper(or paid by shopkeeper):

$CGST = 9$% of $24000 = (\frac{9}{100})\times24000 =$₹$2160$
$SGST = 9$% of $24000 = (\frac{9}{100})\times24000 =$₹$2160$

∴ The Input Tax(under GST) for shopkeeper:
$Input$ $CGST = 2160$
$Input$ $SGST = 2160$

∴ The selling price of TV including tax(under GST) by the distributor is
$Selling$ $Price + CGST+SGST$
=$24000 + 2160+2160$ = ₹$\bold{28320}$

Question 8

The tax (under GST) paid by the distributor to the State Government is

(a) ₹4320
(b) ₹2160 ✓
(c) ₹2880
(d) ₹720

Solution

From Question 7:

As the sales are intra-state and the rate of GST is 18%, so GST comprises of 9% as CGST and 9% as SGST. Distributor sells the TV to shopkeeper for ₹24000, amount of SGST collected by distributor from shopkeeper(or paid by shopkeeper):

$SGST = 9$% of $24000 = (\frac{9}{100})\times24000 =$ ₹$\bold{2160}$

Question 9

The tax (under GST) paid by the shopkeeper to the Central Government is

(a) ₹720 ✓
(b) ₹1440
(c) ₹2880
(d) ₹2160

Solution

Given:

Selling Price of shopkeeper without tax to consumer = Listed Price = ₹$32000$

As the sales are intra-state and the rate of GST is 18%, so GST comprises of 9% as CGST and 9% as SGST. shopkeeper sells the TV to consumer for ₹32000, amount of SGST collected by shopkeeper from consumer(or paid by consumer):

$SGST = 9$% of $32000 = (\frac{9}{100})\times32000 =$ ₹$2880$
$CGST = 9$% of $32000 = (\frac{9}{100})\times32000 =$ ₹$2880$

The Output Tax(under GST) for shopkeeper:
$Output$ $CGST = 2880$
$Output$ $SGST = 2880$

From Question 7:

The Input Tax(under GST) for shopkeeper:
$Input$ $CGST = 2160$
$Input$ $SGST = 2160$

The tax (under GST) paid by the shopkeeper to the Central Government is
= Output CGST - Input CGST
= $2880-2160=$₹$\bold{720}$

Question 10

The tax (under GST) received State Government is

(a) ₹5760
(b) ₹4320
(c) ₹1440
(d) ₹2880 ✓

Solution

From Question 7:

Amount of tax(under GST) paid by distributor to the State Government = ₹2160

From Question 9L

The tax (under GST) paid by the shopkeeper to the Central Government = ₹720
As CGST = SGST
The tax (under GST) paid by the shopkeeper to the State Government = ₹720

The tax (under GST) received State Government is
SGST paid by distributor + SGST paid by shopkeeper
=$2160+720=$₹$\bold{2880}$

Question 11

The price including tax(under GST) of the TV paid by the consumer is

(a) ₹28320
(b) ₹37760 ✓
(c) ₹34880
(d) ₹32000

Solution

Given:
Listed price of TV =₹$32000$

Selling price for shopkeeper excluding tax(or cost price for consumer) = $Listed$ $Price$
= ₹$32000$

As the sales are intra-state and the rate of GST is 18%, so GST comprises of 9% as CGST and 9% as SGST. Shopkeeper sells the TV to consumer for ₹32000, amount of GST collected by shopkeeper from consumer(or paid by consumer):

$CGST = 9$% of $32000 = (\frac{9}{100})\times32000 =$₹$2880$
$SGST = 9$% of $32000 = (\frac{9}{100})\times32000 =$₹$2880$

∴ The price including tax(under GST) of the TV paid by the consumer is
=$Cost$ $Price + CGST+SGST$
=$32000 + 2880+2880$ = ₹$\bold{37760}$

Chapter Test

Question 1

A shopkeeper bought a washing machine at a discount of 20% from a wholesaler, the Printed price of the washing machine being ₹18000. The shopkeeper sells it to a consumer at a discount of 10% on the printed price. If the sales are intra-state and the rate of GST is 12%, find:
(i) the price inclusive of tax (under GST) at which the shopkeeper bought the machine.
(ii) the price which the consumer pays for the machine.
(iii) the tax (under GST) paid by the wholesaler to the State Government.
(iv) the tax (under GST) paid by the shopkeeper to the State Government.
(v) the tax (under GST) received by the Central Government.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Printed price of the washing machine = ₹18000
Rate of discount for shopkeeper = 20%
Cost Price of washing machine for shopkeeper = $Printed$ $Price - Discount$
= $18000 - (\frac{20}{100}\times18000) =$ ₹$14400$

As the sales are intra-state and the rate of GST is 12%, so GST comprises of 6% as CGST and 6% as SGST. Wholesaler sells the washing machine to shopkeeper for ₹14400, amount of GST collected by wholesaler from shopkeeper(or paid by shopkeeper)

$CGST = 6$% of $14400 = (\frac{6}{100})\times14400 =$ ₹$864$
$SGST = 6$% of $14400 = (\frac{6}{100})\times14400 =$ ₹$864$

∴ Amount of Input GST of Shopkeeper:

$Input$ $CGST =$ ₹$864$
$Input$ $SGST =$ ₹$864$

Since the shopkeeper sells the article to consumer at a discount of 10% on printed price, the selling price of article by shopkeeper ( or cost price for consumer):
= $Printed$ $Price - Discount$
= $18000 - (\frac{10}{100}\times18000) =$ ₹$16200$

The amount of GST collected by shopkeeper (or paid by consumer):
$CGST = 6$% of $16200 = (\frac{6}{100})\times16200 =$ ₹$972$
$SGST = 6$% of $16200 = (\frac{6}{100})\times16200 =$ ₹$972$

∴ Amount of output GST of Shopkeeper:

$Output$ $CGST = 972$
$Output$ $SGST = 972$

(i) the price inclusive of tax (under GST) at which the shopkeeper bought the machine.
= Cost price of washing machine for Shopkeeper + CGST paid by shopkeeper + SGST paid by shopkeeper
= $14400 + 864 + 864 =$ ₹$\bold{16128}$

(ii) the price which the consumer pays for the machine.
= Cost price of washing for consumer + CGST paid by consumer + SGST paid by consumer
=$16200 + 972 + 972 =$ ₹$\bold{18144}$

(iii) the tax (under GST) paid by the wholesaler to the state Government.

Calculated above:

= ₹$\bold{864}$.

(iv) the tax (under GST) paid by the shopkeeper to the State Government.
= Output SGST of Shopkeeper - Input SGST of Shopkeeper
= $972 - 864 =$ ₹$\bold{108}$.

(v) the tax (under GST) received by the Central Government.
= CGST paid by Wholesaler + CGST paid by Shopkeeper
= $864 + 108 =$ ₹$\bold{972}$.

Question 2

A manufacturer listed the price of his goods at ₹1600 per article. He allowed a discount of 25% to a wholesaler who in turn allowed a discount of 20% on the listed price to a retailer. The retailer sells one article to a consumer at a discount of 5% on the listed price. If all the sales are intra-state and the rate of GST is 5%, find:
(i) the price per article inclusive of tax (under GST) which the wholesaler pays.
(ii) the price per article inclusive of tax (under GST) which the retailer pays.
(iii) the amount which the consumer pays for the article.
(iv) the tax (under GST) paid by the wholesaler to the State Government for the article.
(v) the tax (under GST) paid by the retailer to the Central Government for the article.
(vi) the tax (under GST) received by the State Government.

Solution

It is a case of intra-state transaction of goods and services:
$SGST = CGST = (\frac{1}{2})\times GST$

Given:
Listed Price of article by manufacturer = ₹1600
Discount percentage given by manufacturer to wholesaler = 25%
Cost Price for wholesaler = $Listed$ $Price - Discount$
= $1600 - (\frac{25}{100}\times1600) =$ ₹$1200$

As the sales are intra-state and the rate of GST is 5%, so GST comprises of 2.5% as CGST and 2.5% as SGST. Manufacturer sells the article to wholesaler for ₹1200, amount of GST collected by manufacturer from wholesaler(or paid by wholesaler)

$CGST = 2.5$% of $1200 = (\frac{2.5}{100})\times1200 =$ ₹$30$
$SGST = 2.5$% of $1200 = (\frac{2.5}{100})\times1200 =$ ₹$30$

∴ Amount of Input GST of wholesaler:

$Input\ CGST =$ ₹$30$
$Input\ SGST =$ ₹$30$