A manufacturer listed the price of his goods at Rs. 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 the sales are intrastate 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.

(i) The listed price per article

\[~=\text{ }Rs.\text{ }1600\]

Discount rate from the manufacture

\[=\text{ }25%\]

Discount

\[=\text{ }\left( 25/100 \right)\text{ }x\text{ }Rs.\text{ }1600\text{ }=\text{ }Rs.\text{ }400\]

So, the selling price per article to the wholesaler = listed price – discount

\[=\text{ }Rs.\text{ }1600\text{ }\text{ }Rs.\text{ }400\]

\[=\text{ }Rs.\text{ }1200\]

The rate of GST = 5%

 

GST = 5% of Rs. 1200

 

\[=\text{ }\left( 5/100 \right)\text{ }x\text{ }Rs.\text{ }1200\]

 

\[=\text{ }Rs.\text{ }60\]

Thus, the price per article inclusive of tax (under GST) which the wholesaler pays = selling price of the manufacture + GST

\[=\text{ }Rs.\text{ }1200\text{ }+\text{ }Rs.\text{ }60\]

\[=\text{ }Rs.\text{ }1260\]

(ii) The wholesaler resells at a discount of 20% on the listed price per article to the retailer,

Discount:

\[=\text{ }\left( 20/100 \right)\text{ }x\text{ }Rs.\text{ }1600\]

\[=\text{ }Rs.\text{ }320\]

So, the selling price of the wholesaler

= listed price – discount

\[=\text{ }Rs.\text{ }1600\text{ }\text{ }Rs.\text{ }320\]

\[=\text{ }Rs.\text{ }1280\]

The rate of GST = 5%

 

GST = 5% of Rs. 1280

 

\[=\text{ }\left( 5/100 \right)\text{ }x\text{ }Rs.\text{ }1280\]

\[=\text{ }Rs.\text{ }64\]

Thus, the price per article inclusive of tax (under GST) which the retailer pays

= selling price of the wholesaler + GST

 

\[=\text{ }Rs.\text{ }1280\text{ }+\text{ }Rs.\text{ }64\]

$$ \[=\text{ }Rs.\text{ }1344\]

(iii) Further, the retailer resells at a discount of 5%

on the listed per article to the consumer

Discount

\[~=\text{ }\left( 5/100 \right)\text{ }x\text{ }Rs.\text{ }1600\]

\[=\text{ }Rs.\text{ }80\]

So, the selling price of the wholesaler

= listed price – discount

\[=\text{ }Rs.\text{ }1600\text{ }\text{ }Rs.\text{ }80\]

\[=\text{ }Rs.\text{ }1520\]

The rate of GST = 5%

 

GST = 5% of Rs. 1520

 

\[=\text{ }\left( 5/100 \right)\text{ }x\text{ }Rs.\text{ }1520\]

\[=\text{ }Rs.\text{ }76\]

Thus,

the price per article inclusive of tax (under GST) which the consumer pays

= selling price of the retailer + GST

 

\[=\text{ }Rs.\text{ }1520\text{ }+\text{ }Rs.\text{ }76\]

\[=\text{ }Rs.\text{ }1596\]

(iv) The tax (under GST) paid by the wholesaler to the State Government for the article

\[=\text{ }Rs.\text{ }\left( 64\text{ }\text{ }62 \right)/2\]

\[=\text{ }Rs.\text{ }4/2\]

or,

\[=\text{ }2\]

(v) The tax (under GST) paid by the retailer to the Central Government for the article

\[=\text{ }Rs.~\left( 76\text{ }\text{ }84 \right)/2\]

\[=\text{ }Rs.\text{ }12/2\]

or,

\[=\text{ }Rs.\text{ }6\]

(vi) The tax (under GST) received by the State Government

\[=\text{ }Rs.\text{ }76/2\text{ }=\text{ }Rs.\text{ }38\]