Question

A dealer pays VAT of Rs. 13000/- @ 5%, find his sales for the given period.
(a) 160000
(b) 260000
(c) 360000
(d) 460000

Answer 1

Hint: In this question, we have been given the VAT (Value Added Tax) and the VAT%, now we have to find the total number of sales, by using this condition, Total Value added tax paid = VAT% of total sales. By further calculations, and using the operations like division and multiplication, find the value of total number of sales.

Complete step-by-step answer:
We have, VAT which is Value Added Tax of Rs. 13000/-
Also, we have a VAT percentage which is 5%.
We need to find the total sales in the given period.
Let us consider the total sales as Rs. $ x $ .
We know,
Total Value added tax paid = VAT% of total sales.
                                   $ 13000=\dfrac{5\times x}{100} $
Now, let us divide the right-hand side of the equation by the number 5 in the numerator and denominator, we get
  $ 13000=\dfrac{x}{20} $
Let us multiply by the number 20 on both the sides of the equation, we get
  $ 13000\times 20=\dfrac{x}{20}\times 20 $
Now, let us solve the following equation to get the value of $ x $ .
  $ 260000=x $
Therefore, $ x $ = 260000

Hence, the total value of sales is Rs. 2,60,000
Therefore option B is the required result.

Note: Value-added tax (VAT) is an indirect tax which is charged at the time of consumption of goods. A VAT tax is paid at every stage of a product's production from the sale of the raw materials to its final purchase by a consumer. Also, in order to find the VAT to the government = Output VAT – Input VAT. Never forget to put units in the question which include the amount of money in order to avoid deduction of marks.