problem on VAT

660 views 1 replies

Compute the VAT payable at each stage using ‘Invoice method from the particulars given below:
Particulars PROFIT (as % of Cost)
X sold the medicines
manufactured by it to
the distributors of
medicines-Y-at Rs. 4000 ------

II Y sold the medicines
to the Wholesalers-Z 56.25%

III Z sold the medicines
to the Retailers-A 25%

IV A sold the medicines
to the ultimate Consumers 25%

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

you can also leave your ans at my id hereforeducation @ rediffmail.com

Replies (1)
Originally posted by : ABHINANDAN JAIN


Compute the VAT payable at each stage using ‘Invoice method from the particulars given below:
Particulars PROFIT (as % of Cost)
X sold the medicines
manufactured by it to
the distributors of
medicines-Y-at Rs. 4000 ------ 4000*4% = 160 = 4160

vat Liability 160

II Y sold the medicines
to the Wholesalers-Z 56.25% ............... 4160*156.25%=6500*4% =260 =6760

Vat Liability 260 - 160 input credit = 100


III Z sold the medicines
to the Retailers-A 25% ......................... 6760*125% = 8450*4%=338+8450=8788

Vat Liability 338 - 260 Input credit = 78


IV A sold the medicines
to the ultimate Consumers 25% .....8788*125%=10985*4% =439.40+10985=11424.40

Vat Liability 439.40 - 338 =101.40 

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

you can also leave your ans at my id hereforeducation @ rediffmail.com

assumed that all the dealers are registered and availing input credit 

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
14 July 2026
Senior Executive/ Manager

H S SHARMA AND CO

Pune

CA Final

View Details
Company
20 June 2026
Chartered Accountant

ANV & Company

New Delhi

CA

View Details
Company
ARTICLESHIP 08 July 2026
Article internship

AJAY SINGH AND CO LLP

Thane

CA Final

View Details
Company
06 July 2026
Chartered Accountant (Indirect Taxation)

Gowra Ventures Pvt Ltd

Hyderabad

CA

View Details
Company
25 June 2026
Accounts & Taxation Executive

Dindukurthy & Associates

Hyderabad

MBA

View Details
Company
29 June 2026
Accountant (Finance & Compliance)

TRIEYEZ

Kolkata

CA

View Details
Company
22 June 2026
Finance Manager- Chartered Accountant

Triveni Turbine Limited

Bengaluru

CA

View Details
Company
ARTICLESHIP 27 June 2026
Article

SNCO

Mumbai

CA Inter

View Details