Question

A manufacturing company in Faridabad (Haryana) marks a machine at $Rs.240000$. It sells a machine to a dealer in Delhi at a discount of $25\% $ on the marked price. The dealer sells it to a consumer in Kerala at a discount of $10\% $ on the marked price. If the rate of GST is $12\% $ calculate the net IGST, CGST payable by the dealer.

Answer 1

Hint: Firstly, we will find the discounted amount and selling price of the Delhi dealer. Further, we will calculate the discounted amount and then sell the price of a consumer in Kerala. Thereafter we will compute IGST, CGST and SGST.

Complete step-by-step answer:
Marked price (MP) $ = $Rs.$2,40,000$
Discount $ = 25\% $
Discounted price $ = $discount of MP
Discounted price $ = 25\% \,\,of\,\,MP$
Discounted price $25\% \,\,of\,\,2,40,000$
Discounted price $25\% \times 2,40,000$
Discounted price \[ = \dfrac{{25}}{{100}} \times 2,40,000\]
Discounted price $ = 25 \times 2,400$
Discounted price $ = 60,000$
Selling price = MP – discount
Selling price $ = 2,40,000 - 60,000$
Selling price$ = $Rs.$1,80,000$
Now, dealers sell to consumers at $10\% $ discount of marked price.
Then,
 Discounted price \[ = \dfrac{{2,40,000 \times 10}}{{100}}\]
Discounted price \[ = 2400 \times 10\]
Discounted price$ = $Rs.$24,000$
Now, $Selling Price\left( {SP} \right) = MP - discounted\,\,price$
$SP = 2,40,000 - 24,000$
$SP = 216000$
Now, GST $ = 12\% $
As we know that $CGST = SGST$
Then $CGST + SGST = GST$
$CGST + CGST = GST$
$2CGST = GST$
$2CGST = 12\% \,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,(\therefore GST = 12\% )$
$CGST = \dfrac{{12\% }}{2}$
\[CGST = 6\% \]
And $CGST = SGST = 6\% $
Then, we will calculate CGST, SGST
$CGST = 6\% \,\,of\,\,MP$
$CGST = 6\% \times MP$
$CGST = 6\% \times 2,40,000$
$CGST = \dfrac{6}{{100}} \times 2,40,000$
$CGST = 6 \times 2400$
$CGST = 14400$
$SGST = 6\% \,of\,MP$
$SGST = 6\% \times MP\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,\,(\therefore MP = 2,40,000)$
$SGST = \dfrac{6}{{100}} \times 2,40,000$
$SGST = 6 \times 2400$
$SGST = 14400$
Now, we know that $GST = 1GST$
Then $IGST = 12\% \,\,MP$
$IGST = 12\% \,\, \times MP$
$IGST = 12\% \times 2,40,000$
$IGST = \dfrac{{12}}{{100}} \times 2,40,000$
$IGST = $Rs.$28800$

Note: Students must keep in mind that discount, GST, IGST, CGST and IGST all term are calculated on the marked price. And GST and IGST are each equal to each other. SGST and CGST are equal to each other.