Question

A man pays 5 paise tax on Re 1. If the total tax paid by the man is Rs 1550.00, then on what amount did he pay the tax?
[a] Rs. 31000
[b] Rs. 30000
[c] Rs 15500
[d] Rs 15505

Answer 1

Hint: Assume that the total amount on which the tax is paid by the merchant be A. Use unitary method to find the total tax payable on amount A. Equate this amount to Rs 1550.00 and hence form an equation in A. Solve for A and hence find the total amount on which the tax was levied. Verify your answer.

Complete step by step solution:
Let the amount in which the tax was paid be Rs. A.
Now, we have an amount of 1 Rupee tax paid = 0.05 Rupees.
Hence, we have an amount of Rs. A tax paid $=0.05\times A$
Hence the tax payable on amount A is 0.05A.
But according to the question the tax payable on amount A is Rs.1550
Hence, we have
$\begin{align}
  & 0.05A=1550 \\
 & \Rightarrow A=\dfrac{1550}{0.05}=\dfrac{155000}{5}=31000 \\
\end{align}$
Hence the amount on which the tax was paid is Rs 31000.
Hence option [a] is correct.
Note: Alternative Solution:
Rs 0.05 is levied on amount of Re 1
Re 1 is levied on amount of $\dfrac{1}{0.05}=20$ rupees
Hence the amount on which Rs 1550 is levied is $20\times 1550=31000$, which is the same as obtained above.
Hence option [a] is correct