A dealer purchased a music system from the manufacturing company for ₹ 25000 and sold it to a consumer at a profit of 20%. If the rate of GST is 18%, calculate
(i) the amount of Input CGST and Input SGST for the dealer.
(ii) the amount of GST payable by dealer to the government.
(iii) the amount that the consumer had to pay for the music system.
[Assume that all the transactions take place in the same state]

Question

A dealer purchased a music system from the manufacturing company for ₹ 25000 and sold it to a consumer at a profit of 20%. If the rate of GST is 18%, calculate
(i) the amount of Input CGST and Input SGST for the dealer.
(ii) the amount of GST payable by dealer to the government.
(iii) the amount that the consumer had to pay for the music system.
[Assume that all the transactions take place in the same state]

KnowledgeBoat · Accepted Answer

Given: Cost Price (CP) for the dealer = ₹ 25,000 GST rate = 18% All transactions occur within the same state, so CGST and SGST are applicable. CGST rate = SGST rate = = 9% The dealer makes a 20% profit while selling to consumer. Selling Price (excluding GST) = ₹ 25,000 + 20% of ₹ 25,000 = ₹ 25,000 + = ₹ 25,000 + ₹ 5,000 = ₹ 30,000. (i) For dealer : On purchase price of ₹ 25,000. Input CGST = 9% of ₹ 25,000 = = ₹ 2,250. Input SGST = 9% of ₹ 25,000 = = ₹ 2,250. Hence, for dealer input CGST = input SGST = ₹ 2,250. (ii) Total input GST = ₹ 2,250 + ₹ 2,250 = ₹ 4,500. Output GST (on dealer's sale) On selling price of ₹ 30,000. Output CGST = 9% of ₹ 30,000 = = ₹ 2,700 Output SGST = 9% of ₹ 30,000 = = ₹ 2,700 Total output GST = ₹ 2,700 + ₹ 2,700 = ₹ 5,400 GST payable by dealer to government = Output GST – Input GST = ₹ 5,400 - ₹ 4,500 = ₹ 900. Hence, GST payable by dealer to the government = ₹ 900. (iii) Cost price for consumer = ₹ 30,000 GST for consumer = GST charged by dealer = ₹ 5,400 Total = ₹ 30,000 + ₹ 5,400 = ₹ 35,400. Hence, amount consumer pays for the music system = ₹ 35,400.

Company	C₁	C₂	C₃	C₄	C₅
Service costs	₹8,200	₹12,100	₹13,600	₹8,000	₹1,500
Discount	30%	25%	20%	15%	10%

Mathematics

GST

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