Please help solve this question

But,You can't add 12500 because VAT is not applicable on purchases from outside the state.All u can do is to add 2000 i.e 2% CST........

hello...

both the answer is correct...if u r assuming....

that 12.5 % is charged (goods purchased from other state)...as solved in book ahuja and gupta...

than ur asnwer will...25000..

other state purchase..               112500

(Added: Other state Vat @ 12.5%)

local purchase                           200000

(225000-25000 of vat)

other expenses and profit..        87500

total                                                 400000

vat charged @ 12.5%                   50000

billed amount:                               450000

Vat payable:

VAT liablity                                      50000

ITC  on local purchase only*   -  25000

Vat liability stands                         25000.................................(1)

If you are not assuming...other state VAt..

then simply....

other state purchase    100000

local purchase               200000

exp. and profit                 87500

Total                                 387500

VAT                                   48438

bill amount:                    435938

Vat liabilty                      48438

ITC                                -25000

VAT liability stands     23438.....................................................(2)