Question

Mrs. Lama marked the price of a cosmetic item 25% above its cost price. If the cost price of the cosmetic item was Rs 4,400, at what price did she sell it with 13% VAT? Mrs. Kandel went to a restaurant with her family. They had three plates of Mo:Mo at Rs 120 per plate, one plate chicken chilly at Rs 220 per plate, and three bottles of cold drink at Rs 40 per bottle. (1) What was the bill with 10% service charge? (ii) How much did she pay to clear the bill with 13% value added tax?​

Answer 1

1st one: Selling price with VAT is Rs 6,215

2nd one:

i. Bill with 10% service charge is Rs 770.

ii. She paid Rs 870.10

Explanation:

For 1st Question:

Given:

Cost price= Rs 4,400

Profit% =25%=0.25

Selling price with VAT =?

VAT%=13%=0.13

We have

Selling Price = Cost Price +Profit % of Cost Price

Selling Price = Rs 4,400 +0.25* Rs 4,400

Selling Price = Rs 4,400 + Rs 1,100

Selling Price = Rs 5,500

Now

Finding the selling price with VAT:

We have

Selling price with VAT = Selling Price + VAT% of Selling Price

Selling price with VAT = Rs 5,500 + 0.13 * Rs 5,500

Selling price with VAT = Rs 5,500 + Rs 715

Selling price with VAT = Rs 6,215

Therefore, Mrs. Lama sold the cosmetic item for Rs 6,215 with 13% VAT.

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For 2nd Question;

Total cost of Mo:Mo plates = 3 plates * Rs 120 per plate = Rs 360

Cost of chicken chilly plate = 1 plate * Rs 220 per plate = Rs 220

Total cost of cold drink bottles = 3 bottles * Rs 40 per bottle = Rs 120

Total bill before service charge = Rs 360 + Rs 220 + Rs 120 = Rs 700

i.
Bill with 10% service charge=?

Service charge=10%=0.10

Let's find the service charge:

Service charge = Service charge% of Rs 700 =0.10* Rs 700 = Rs 70

Now

Total bill with 10% service charge =Total bill before service charge + Service charge

= Rs 700 + Rs 70 = Rs 770

Therefore, Bill with 10% service charge is Rs 770.

ii.

Bill with 10% service charge= Rs 770

VAT%=13%=0.13

bill with 13% VAT=?

Let's find the VAT amount first:

VAT amount= VAT% of Total Cost= 0.13* Rs 770 = Rs 100.10

Now

Amount to pay for the bill with VAT = Total bill with 10% service charge + 13% of Total bill with 10% service charge

Amount to pay = Rs 770 + Rs 100.10 = Rs 870.10

Therefore, Mrs. Kandel paid Rs 870.10 to clear the bill with 13% VAT.

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