vat calculation

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harkeshmohan (Querist)
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10 February 2011 I AM IN CONFUSION TO COMPUTE THE VAT PAYABLE AT EACH STAGE USING "INVOICE METHOD"

AA (MANUFACTURER) sold goods to BB (DISTRIBUTOR) at Rs. 4000/=
profit (as % of cost price) ----
-------------------------------------------

BB sold goods to CC(WHOLESALER)
-----profit (as % of cost price) 56.25%

-------------------------------------------

CC sold goods to DD (RETAILER)
-----profit (as % of cost price) 25.00%

DD sold goods to EE (ULTIMATE CONSUMER)
-----profit (as % of cost price) 25.00%

Assume that the VAT rate is 4% and that there was no value addition at various stages of sale except profit margin.

harkeshmohan

harkeshmohan (Querist)
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22 March 2011
harkeshmohan

( Author )
10 February 2011
I AM IN CONFUSION TO COMPUTE THE VAT PAYABLE AT EACH STAGE USING "INVOICE METHOD"

AA (MANUFACTURER) sold goods to BB (DISTRIBUTOR) at Rs. 4000/=
profit (as % of cost price) ----
-------------------------------------------

BB sold goods to CC(WHOLESALER)
-----profit (as % of cost price) 56.25%

-------------------------------------------

CC sold goods to DD (RETAILER)
-----profit (as % of cost price) 25.00%

DD sold goods to EE (ULTIMATE CONSUMER)
-----profit (as % of cost price) 25.00%

Assume that the VAT rate is 4% and that there was no value addition at various stages of sale except profit margin.