Question

If a phone costs £240 including VAT (20%), how much does it cost excluding VAT?

a) £192
b) £200
c) £210
d) £220

Answer 1

To find the cost of the phone excluding VAT, subtract the VAT amount from the total cost. The cost of the phone excluding VAT is £192.

Step-by-step explanation:

To find the cost of the phone excluding VAT, we need to subtract the VAT amount from the total cost. The VAT amount can be found by multiplying the total cost by the VAT rate (20%).

VAT amount = Total cost * VAT rate = £240 * 20% = £48

Therefore, the cost of the phone excluding VAT is £240 - £48 = £192.