Chapter 4 - Financial Planning
Practice set 4.1
1. ‘Pawan Medical’ supplies medicines. On some medicines the rate of GST is 12%, then what is the rate of CGST and SGST?
Solution:
Rate of GST on medicines = 12%
Ans: Rate of CGST is 6% and Rate of SGST is 6%
2. On certain article if rate of CGST is 9% then what is the rate of SGST? and what is the rate of GST?
Solution:
Rate of CGST = 9%
∴ Rate of CGST = Rate of SGST = 9%
∴ Rate of GST
= Rate of CGST + Rate of SGST
= 9% + 9%
∴ Rate of GST = 18%
Ans: Rate of SGST is 9% and rate of GST is 18%.
3. ‘M/s. Real Paint’ sold 2 tins of lustre paint and taxable value of each tin is ₹ 2800. If the rate of GST is 28%, then find the amount of CGST and SGST charged in the tax invoice.
Solution:
Taxable value of 2 boxes of paints
= 2 × 2800
= ₹ 5600
Rate of GST = 28%
∴ Rate of CGST is 14% and rate of SGST is 14%.
∴ CGST
= 14% of ₹ 5600
= \(\large \frac {14}{100}\) × 5600
= ₹ 784
∴ CGST = SGST = ₹ 784
Ans: The amount of CGST is ₹ 784 and SGST is ₹ 784 charged in tax invoice.
4. The taxable value of a wrist watch belt is ₹586. Rate of GST is 18%. Then what is price of the belt for the customer ?
Solution:
Taxable value = ₹ 586
Rate of GST = 18%
∴ Rate of CGST = 9% and Rate of SGST = 9%
∴ CGST
= 9% of ₹ 586
= \(\large \frac {9}{100}\) × 586
= ₹ 52.74
∴ CGST = SGST = ₹ 52.74
∴ Amount to be paid by customer
= Taxable value + CGST + SGST
= 586 + 52.74 + 52.74
= ₹ 691.48
Ans: The price of belt for customer is ₹ 691.48.
5. The total value (with GST) of a remote-controlled toy car is ₹ 1770. Rate of GST is 18% on toys. Find the taxable value, CGST and SGST for this toy-car.
Solution:
Rate of GST = 18%
If taxable value is ₹ 100 then total value of toy car including GST will be (100 + 18) = ₹ 118.
Similarly, if taxable value is ₹ x, than total value of toy car including GST is ₹ 1770.
∴ \(\large \frac {100}{x}\) = \(\large \frac {118}{1770}\)
∴ x = \(\large \frac {100\,×\,1770}{118}\)
∴ x = 1500
Rate of GST = 18%
Rate of CGST is 9% and rate of SGST is 9%
∴ CGST
= 9% of ₹ 1500
= \(\large \frac {9}{100}\) × 1500
= ₹ 135
∴ CGST = SGST = ₹ 135
Ans: The taxable value of a car is ₹ 1500, CGST for the toy-car is ₹ 135 and SGST for the toy-car is ₹ 135.
6. ‘Tiptop Electronics’ supplied an AC of 1.5 tons to a company. Cost of the AC supplied is ₹51,200 (with GST). Rate of CGST on AC is 14%. Then find the following amounts as shown in the tax invoice of Tiptop Electronics.
(1) Rate of SGST
(2) Rate of GST on AC
(3) Taxable value of AC
(4) Total amount of GST
(5) Amount of CGST
(6) Amount of SGST
Solution:
(1) Rate of CGST on A.C. = 14% …[Given]
Ans: Rate of SGST on A.C. = 14%
(2) Rate of GST on A.C.
= Rate of CGST + Rate of SGST
= 14% + 14%
= 28%
Ans: Rate of GST on A.C. = 28%
(3) If taxable value of A.C. is ₹ 100, then total value including GST will be (100 + 28) = ₹ 128.
Similarly, if taxable value of an A.C. is ₹ x then total value including GST is ₹ 51,200.
∴ \(\large \frac {100}{x}\) = \(\large \frac {128}{51200}\)
∴ x = \(\large \frac {51200\,×\,100}{11l28}\)
∴ x = 40000
Ans: The taxable value of an A.C. is ₹ 40,000
(4) Total GST
= Total cost including GST – Taxable price
= 51,200 – 40,000
= ₹ 11,200
Ans: Total GST is ₹ 11,200
(5) Amount of CGST
= \(\large \frac {Total\,GST}{2}\)
= \(\large \frac {11200}{2}\)
= ₹ 5600
Ans: Amount of CGST = ₹ 5600
(6) Amount of CGST = Amount of SGST = ₹ 5600
Ans: Amount of SGST = ₹ 5600
7. Prasad purchased a washing-machine from ‘Maharashtra Electronic Goods’. The discount of 5% was given on the printed price of ₹40,000. Rate of GST charged was 28%. Find the purchase price of washing machine. Also find the amount of CGST and SGST shown in the tax invoice.
Solution:
The printed price of a washing machine = ₹ 40,000
Rate of Discount = 5%
∴ Discount
= 5% of ₹ 40,000
= \(\large \frac {5}{100}\) × 40000
= ₹ 2000
∴ Taxable value of washing machine
= Printed price – Discount
= 40,000 – 2000
= ₹ 38,000
Rate of GST on washing machine = 28%
∴ Rate of CGST is 14% and rate of SGST is 14%
∴ CGST
= 14% of ₹ 38000
= \(\large \frac {14}{100}\) × 38000
∴ CGST = ₹ 5320
∴ CGST = SGST = ₹ 5320
Purchase price of washing machine
= Taxable value + CGST + SGST
= 38000 + 5320 + 5320
= ₹ 48,640
Ans: Prasad paid ₹ 48,640 for washing machine and the CGST for the washing machine is ₹ 5320 and SGST for the washing machine is ₹ 5320.
Practice set 4.2
1. ‘Chetana Store’ paid a total GST of ₹ 1,00,500 at the time of purchase and collected GST ₹ 1,22,500 at the time of sale during 1st of July 2017 to 31st July 2017. Find the GST payable by Chetana Stores.
Solution:
Input tax (ITC) = ₹ 1,00,500
Output tax = ₹ 1,22,500
∴ GST payable
= Output tax – ITC
= 1,22,500 – 1,00,500
= ₹ 22,000
Ans: The GST payable by Chetana Stores is ₹ 22,000.
2. Nazama is a proprietor of a firm, registered under GST. She has paid GST of ₹ 12,500 on purchase and collected ₹ 14,750 on sale. What is the amount of ITC to be claimed ? What is the amount of GST payable ?
Solution:
Input tax (ITC)= ₹ 12,500
Output tax = ₹ 14,750
∴ GST Payable
= Output tax – ITC
= 14,750 – 12,500
= ₹ 2250
Ans: Input tax credit for Nazama is ₹ 12500 and GST to be paid is ₹ 2250.
3. Amir Enterprise purchased chocolate sauce bottles and paid GST of ₹ 3800. He sold those bottles to Akbari Bros. and collected GST of ₹ 4100. Mayank Food Corner purchased these bottles from Akabari Bros and paid GST of ₹ 4500. Find the amount of GST payable at every stage of trading and hence find payable CGST and SGST.
Solution:
(i) For Amir Enterprises:
ITC = ₹ 3800
Output tax = ₹ 4100
∴ GST payable
= Output tax – ITC
= 4100 – 3800
= ₹ 300
CGST = SGST = \(\large \frac {300}{2}\) = ₹ 150
(ii) For Akbari Brothers:
ITC = ₹ 4100
Output tax = ₹ 4500
∴ GST payable
= Output tax – ITC
= 4500 – 4100
= ₹ 400
CGST = SGST = \(\large \frac {400}{2}\) = ₹ 200
Ans: GST payable by Amir Enterprises is ₹ 300 and CGST is ₹ 150 and SGST is ₹ 150 and GST payable by Akbari Brothers is ₹ 400 and CGST is ₹ 200 and SGST is ₹ 200.
4. Malik Gas Agency (Chandigarh Union Territory) purchased some gas cylinders for industrial use for ₹ 24,500, and sold them to the local customers for ₹ 26,500. Find the GST to be paid at the rate of 5% and hence the CGST and UTGST to be paid for this transaction. (for Union Territories there is UTGST instead of SGST.)
Solution:
Tax paid at the time of purchase (Input tax ITC)
= 5% of ₹ 24,500
= \(\large \frac {5}{100}\) × 24500
= ₹ 1225
Tax collected at the time of sale (Output tax)
= 5% of ₹ 26,500
= \(\large \frac {5}{100}\) × 26500
= ₹ 1325
∴ GST
= Output tax – ITC
= 1325 – 1225
= ₹ 100
∴ CGST = UTGST = \(\large \frac {100}{2}\) = ₹ 50
Ans: GST to be paid by Malik gas agency is ₹ 100, CGST = ₹ 50 and UTGST = ₹ 50
5. M/s Beauty Products paid 18% GST on cosmetics worth ₹ 6000 and sold to a customer for ₹ 10,000. What are the amounts of CGST and SGST shown in the tax invoice issued ?
Solution:
Tax paid at the time of purchase (ITC)
= 18% of ₹ 6000
= \(\large \frac {18}{100}\) × 6000
= ₹ 1080
Tax collected at the time of sale (Output tax)
= 18% of ₹ 10,000
= \(\large \frac {18}{100}\) × 10000
= ₹ 1800
∴ GST
= Output tax – ITC
= 1800 – 1080
= ₹ 720
Tax invoice for GST:
Ans: CGST is ₹ 900 and SGST is ₹ 900.
6. Prepare Business to Consumer (B2C) tax invoice using given information. Write the name of the supplier, address, state, Date, invoice number, GSTIN etc. as per your choice.
Supplier :
M/s – – – – – – – – Address – – – – – State – – – – – Date – – – – – – – Invoice No. – – – – – GSTIN – – – – – – – – – – – – – –
Particulars –
Rate of Mobile Battery – ₹ 200 Rate of GST 12% HSN 8507, 1 pc.
Rate of Headphone – ₹ 750 Rate of GST 18% HSN 8518, 1 pc.
Solution:
(7) Prepare Business to Business (B2B) Tax Invoice as per the details given below. Name of the supplier, address, Date etc. as per your choice.
Supplier – Name, Address, State, GSTIN, Invoice No., Date
Recipient – Name, Address, State, GSTIN,
Items :
(1) Pencil boxes 100, HSN – 3924, Rate – ₹ 20, GST 12%
(2) Jigsaw Puzzles 50, HSN 9503, Rate – ₹ 100 GST 12%.
Solution:
Practice set 4.3
(1) Complete the following table by writing suitable numbers and words.
Solution:
(2) Mr. Amol purchased 50 shares of Face Value ₹ 100 when the Market value of the share was ₹ 80. Company had given a 20% dividend. Find the rate of return on investment.
Solution:
FV of share = ₹ 100
Dividend per share
= 20% of ₹ 100
= \(\large \frac {20}{100}\) × 100
= ₹ 20
∴ Dividend on 50 shares
= 50 × 20
= ₹ 1000
MV of share = ₹ 80
Total investment
= 50 × 80
= ₹ 4000
Rate of return
= \(\large \frac {Total \,dividend received}{Total\, investment}\) × 100
= \(\large \frac {1000}{4000}\) × 100
= 25 %
Ans: Rate of return is 25%
(3) Joseph purchased following shares, Find his total investment.
Company A : 200 shares, FV = ₹ 2, Premium = ₹ 18.
Company B : 45 shares, MV = ₹ 500
Company C : 1 share, MV = ₹ 10,540.
Solution:
Company A :
Premium = ₹ 18 and FV = ₹ 2
MV of 1 share
= FV + Premium
= 2 + 18
= ₹ 20
Total investment in Company A
= No. of shares × MV
= 200 × 20
= ₹ 4000
Company B :
No. of shares = 45 , MV = ₹ 500
∴ Total investment in Company B
= No. of shares × MV
= 45 × 500
= ₹ 22,500
Company C :
No. of shares = 1, MV = ₹ 10,540
∴ Total investment in Company C
= No. of shares × MV
= 1 × 10,540
= ₹ 10,540
Now,
Total investment
= 4000 + 22,500 + 10,540
= ₹ 37,040
Ans: Total investment is ₹ 37,040.
(4) Smt. Deshpande purchased shares of FV ₹ 5 at a premium of ₹ 20. How many shares will she get for ₹ 20,000?
Solution:
FV of share = ₹ 5, Premium = ₹ 20
∴ MV
= FV + Premium
= 5 + 20
= ₹ 25
Total investment = ₹ 20,000
∴ Number of shares
= \(\large \frac {Total\,investment}{MV}\)
= \(\large \frac {20000}{25}\)
= 800
Ans: Mrs. Deshpande will get 800 shares.
(5) Shri Shantilal has purchased 150 shares of FV ₹ 100, for MV of ₹ 120. Company has paid dividend at 7%. Find the rate of return on his investment.
Solution:
FV of share = ₹ 100
Dividend on one share
= 7% of ₹ 100
= \(\large \frac {1}{2}\) × 100
= ₹ 7
Dividend on 150 shares
= 150 × 7
= ₹ 1050
MV of share = ₹ 120
Total investment
= 150 × 120
= ₹ 18,000
Rate of return
= \(\large \frac {Total \,dividend received}{Total\, investment}\) × 100
= \(\large \frac {1050}{18000}\) × 100
= 5.83 %
Ans: Rate of return on his investment is 5.83%
(6) If the face value of both the shares is same, then which investment out of the following is more profitable?
Company A : dividend 16%, MV = ₹ 80.
Company B : dividend 20%, MV = ₹ 120.
Solution:
Suppose the amount invested in both the companies is ₹ 9600, (i.e ₹ 80 × ₹ 120)
Let x be the face value.
For company A:
MV = ₹ 80
Dividend rate = 16%
No of shares purchased
= \(\large \frac {Amount\,Invested}{MV}\)
= \(\large \frac {9600}{800}\)
= 120
Dividend per share
= Face value × rate
= x × 16%
= x × \(\large \frac {16}{100}\)
= 0.16x
Dividend on shares
= Dividend per share × No. of share
= 120 × 0.16x
= 1.92x
For company B:
MV = ₹ 120
Dividend rate = 20%
No of shares purchased
= \(\large \frac {Amount\,Invested}{MV}\)
= \(\large \frac {9600}{800}\)
= 120
Dividend per share
= Face value × rate
= x × 20%
= x × \(\large \frac {20}{100}\)
= 0.20x
Dividend on shares
= Dividend per share × No. of share
= 80 × 0.20x
= 1.60x
Now,
Company A gives more amount of dividend than company B,
∴ Investment in Company A is more profitable
Practice set 4.4
1. Market value of a share is ₹ 200. If the brokerage rate is 0.3% then find the purchase value of the share.
Solution:
MV = ₹ 200
Brokerage = 0.3%
Brokerage per share
= 0.3% of ₹ 200
= \(\large \frac {0.3}{100}\) × 200
= ₹ 0.60
Purchase value per share
= Market value + Brokerage
= 200 + 0.60
= ₹ 200.60
Ans: Purchase value of the share is ₹ 200.60
2. A share is sold for the market value of ₹ 1000. Brokerage is paid at the rate of 0.1%. What is the amount received after the sale ?
Solution:
MV = ₹ 1000
Brokerage = 0.1%
Brokerage per share
= 0.1% of ₹ 1000
= \(\large \frac {0.1}{100}\) × 1000
= ₹ 1
∴ Selling price per share
= MV – Brokerage
= 1000 – 1
= ₹ 999
Ans: The amount obtained on selling the share is ₹ 999.
3. Fill in the blanks given in the contract note of sale-purchase of shares.
(B – buy S – sell)
Solution:
4. Smt. Desai sold shares of face value ₹ 100 when the market value was ₹ 50 and received ₹ 4988.20. She paid brokerage 0.2% and GST on brokerage 18%, then how many shares did she sell ?
Solution:
Market value of share = ₹ 50
Brokerage = 0.2%
∴ Brokerage per share
= 0.2% of ₹ 50
= \(\large \frac {0.2}{100}\) × 50
= ₹ 0.10
∴ GST on brokerage per share
= 18 % of ₹ 0.10
= \(\large \frac {18}{100}\) × 0.10
= ₹ 0.018
Total selling price per share
= MV – Brokerage – GST
= 50 – 0.10 – 0.018
= ₹ 49.882
∴ Number of shares sold
= \(\large \frac {Total \,amount \,received}{Selling \,price \,of \,one \,share}\)
= \(\large \frac {4988.20}{49.882}\)
= 100
Ans: Smt. Desai sold 100 shares.
5. Mr. D’souza purchased 200 shares of FV ₹ 50 at a premium of ₹ 100. He received 50% dividend on the shares. After receiving the dividend he sold 100 shares at a discount of ₹ 10 and remaining shares were sold at a premium of ₹ 75. For each trade he paid the brokerage of ₹ 20. Find whether Mr. D’souza gained or incurred a loss ? by how much ?
Solution:
Share at premium = ₹ 100, FV = ₹ 50 and dividend = 50%
Dividend per share
= 50% of ₹ 50
= \(\large \frac {50}{100}\) × 50
= ₹ 25
Dividend on 200 share
= 200 × 25
= ₹ 5000
Purchase price per share
= FV + Premium
= 50 + 100
= ₹ 150
∴ Purchase price of 200 shares
= 200 × 150 + Brokerage
= 30,000 + 20
= ₹ 30,020
Now, 100 shares were sold at ₹ 10 discount
∴ Selling price per share
= FV – discount
= 50 – 10
= ₹ 40
∴ Selling price of first 100 shares
= 100 × 40 – Brokerage
= 4000 – 20
= ₹ 3980
Now, remaining 100 shares were sold at ₹ 75 premium.
∴ Selling price per share
= FV + Premium
= 50 + 75
= ₹ 125
∴ Selling price of 100 shares
= 100 × 125 – Brokerage
= 12,500 – 20
= ₹ 12,480
∴ Amount received on selling 200 shares
= Dividend + Selling Price
= 3,980 + 12,480
= ₹ 16,460
Net amount received
= 5000 + 16,450
= ₹ 21,460
Here, net amount invested = ₹ 30,020 and net amount received = ₹ 21,460
∴ Net amount received < Net amount invested
There is a loss in the transaction
Loss incurred
= Net amount invested – Net amount received
= 30,020 – 21,460
= ₹ 8560
Ans: Mrs. D’Souza made a loss of ₹ 8560 in the whole transaction.
Problem Set 4A
1. Write the correct alternative for each of the following.
(1) Rate of GST on essential commodities is _____.
(A) 5%
(B) 12%
(C) 0%
(D) 18%
Ans: Option (C) : 0%
(2) The tax levied by the central government for trading within state is _____.
(A) IGST
(B) CGST
(C) SGST
(D) UTGST
Ans: Option (B) : CGST
(3) GST system was introduced in our country from m _____.
(A) 31st March 2017
(B) 1st April 2017
(C) 1st January 2017
(D) 1st July 2017
Ans: Option (D) : 1st July 2017
(4) The rate of GST on stainless steel utensils is 18%, then the rate of State GST is _____.
(A) 18%
(B) 9%
(C) 36%
(D) 0.9%
Ans: Option (B) : 9%
(5) In the format of GSTIN there are _____ alpha-numerals.
(A) 15
(B) 10
(C) 16
(D) 9
Ans: Option (A) : 15
(6) When a registered dealer sells goods to another registered dealer under GST, then this trading is termed as _____.
(A) BB
(B) B2B
(C) BC
(D) B2C
Ans: Option (B) : B2B
2. A dealer has given 10% discount on a showpiece of ₹ 25,000. GST of 28% was charged on the discounted price. Find the total amount shown in the tax invoice. What is the amount of CGST and SGST ?
Solution:
The price of an article = ₹ 25,000
Rate of discount = 10%
∴ Discount
= 10% of × 25000
= \(\large \frac {10}{100}\) × 25000
= ₹ 2500
Taxable value of an article
= 25000 – 2500
= ₹ 22500
Rate of GST = 28%
∴ Rate of CGST = Rate of SGST = 14%
∴ CGST
= 14% of ₹ 22,500
= \(\large \frac {14}{100}\) × 22500
= ₹ 3,150
∴ CGST = SGST = ₹ 3,150
∴ Total cost of an article
= Taxable price + CGST + SGST
= 22500 + 3150 +3150
= ₹ 28,800
Ans: Total bill amount is ₹ 28800, CGST is ₹ 3150 and SGST is ₹ 3150
3. A ready-made garment shopkeeper gives 5% discount on the dress of ₹ 1000 and charges 5% GST on the remaining amount, then what is the purchase price of the dress for the customer ?
Solution:
Price of a dress = ₹ 1000
Rate of discount = 5%
Discount
= 5% of ₹ 1000
= \(\large \frac {5}{100}\) × 1000
= ₹ 50
Taxable value of a dress
= 1000 – 50
= ₹ 950
Rate of GST = 5%
Rate of CGST is 2.5% and rate of SGST is 2.5%
∴ CGST
= 2.5% of ₹ 950
= \(\large \frac {2.5}{100}\) × 950
= ₹ 23.75
∴ CGST = SGST = ₹ 23.75
.Total cost of the dress
= Taxable value + CGST + SGST
= 950 +23.75 + 23.75
= ₹ 997.50
Ans: The customer has to pay ₹ 997.50 for the dress.
4. A trader from Surat, Gujarat sold cotton clothes to a trader in Rajkot, Gujarat. The taxable value of cotton clothes is ₹ 2.5 lacs. What is the amount of GST at 5% paid by the trader in Rajkot?
Solution:
Taxable value of cotton clothes = ₹ 2.5 lacs
Rate of GST applicable = 5%
∴ GST
= 5% of ₹ 2.5 lacs
= \(\large \frac {5}{100}\) × 250000
= ₹ 12,500
Ans: The GST to be paid by the businessman from Rajkot is ₹ 12,500.
5. Smt. Malhotra purchased solar panels for the taxable value of ₹ 85,000. She sold them for ₹ 90,000. The rate of GST is 5%. Find the ITC of Smt. Malhotra. What is the amount of GST payable by her ?
Solution:
Input tax (ITC)
= 5% of ₹ 85,000
= \(\large \frac {5}{100}\) × 85000
= ₹ 4250
Output tax
= 5% of × 90,000
= \(\large \frac {5}{100}\) × 90000
= ₹ 4500
∴ GST Payable
= Output Tax – ITC
= 4500 – 4250
= ₹ 250
Ans: ITC is ₹ 4250 and GST payable is ₹ 250
6. A company provided Z-security services for the taxable value of ₹ 64,500. Rate of GST is 18%. Company had paid GST of ₹ 1550 for laundry services and uniforms etc. What is the amount of ITC (input Tax Credit) ? Find the amount of CGST and SGST payable by the company.
Solution:
Taxable value for security provided = ₹ 64,500
Rate of GST = 18%
Output tax
= 18% of ₹ 64,500
= \(\large \frac {18}{100}\) × 64500
= ₹ 11,610
GST paid by company for laundry services and uniform etc. = ₹ 1550
∴ ITC = ₹ 1550
∴ GST payable by the company
= Output tax – ITC
= 11610 – 1550
= ₹ 10,060
Now CGST = SGST = \(\large \frac {10060}{2}\) = ₹ 5030
Ans: ITC for the company is ₹ 1550 and CGST is ₹ 5030 and SGST is ₹ 5030
7. In an A.P. the first term is – 5 and last term is 45. If the sum of all numbers in the A.P. is 120, then how many terms are there? What is the common difference?
Solution:
Here,
t₁ = a = – 5, tₙ = 45, Sₙ = 120, n = ?, d = ?
Now,
Sₙ = \(\large \frac {n}{2}\) [t₁ + tₙ]
∴ 120 = \(\large \frac {n}{2}\) [– 5 + 45]
∴ 240 = n [40]
∴ n = \(\large \frac {240}{40}\)
∴ n = 6
tₙ = a + (n – 1)d
∴ 45 = – 5 + (6 – 1)d
∴ 45 = – 5 + 5d
∴ 45 + 5 = 5d
∴ 5d = 50
∴ d = \(\large \frac {50}{5}\)
∴ d = 10
Ans: There are 6 terms in the A.P and the common difference is 10.
7. A dealer supplied Walky-Talky set of ₹ 84,000 (with GST) to police control room. Rate of GST is 12%. Find the amount of state and central GST charged by the dealer. Also find the taxable value of the set.
Solution:
Rate of GST = 12%
If taxable value is ₹ 100, then total value including GST will be (100 + 12) = ₹ 112.
Similarly, if taxable value is ₹ x then total value including GST is ₹ 84,000.
∴ \(\large \frac {100}{x}\) = \(\large \frac {112}{84000}\)
∴ x = \(\large \frac {84000\,×\,100}{112}\)
∴ x = 75000
Rate of GST = 12%
∴ Rate of CGST is 6% and rate of SGST is 6%
CGST
= 6% of ₹ 75000
= \(\large \frac {6}{100}\) × 75000
= ₹ 4500
∴ CGST = SGST = ₹ 4500
Ans: The taxable value of Walky Talky sets is ₹ 75,000 and the amount of CGST is ₹ 4500 and SGST is ₹ 4500.
8. A wholesaler purchased electric goods for the taxable amount of ₹ 1,50,000. He sold it to the retailer for the taxable amount of ₹ 1,80,000. Retailer sold it to the customer for the taxable amount of ₹ 2,20,000. Rate of GST is 18%. Show the computation of GST in tax invoices of sales. Also find the payable CGST and payable SGST for wholesaler and retailer.
Solution:
(i) For wholesaler:
Taxable amount of Electric goods = ₹ 1,50,000
Rate of GST = 18%
∴ Tax paid at the time of purchase (ITC)
= 18% of ₹ 1,50,000
= \(\large \frac {18}{100}\) × 150000
= ₹ 27,000
Tax collected at time of sale (Output tax)
= 18% of ₹ 1,80,000
= \(\large \frac {18}{100}\) × 180000
= ₹ 32,400
∴ CGST and SGST shown in the tax invoice of wholesaler
= \(\large \frac {32400}{2}\)
= ₹ 16,200
∴ GST payable by wholesaler
= Output tax – ITC
= ₹ 32,400 – ₹ 27,000
= ₹ 5400
CGST to be paid by wholeseller
= \(\large \frac {5400}{2}\)
= ₹ 2700
∴ CGST = SGST = ₹ 2700 is payable by wholeseller
(ii) For retailer:
Tax paid at the time of purchase (ITC) = ₹ 32,400
Tax collected at the time of sale (Output tax)
= 18% of ₹ 2,20,000
= \(\large \frac {18}{100}\) × 220000
= ₹ 39,600
∴ CGST and SGST shown in the tax invoice of retailer
= \(\large \frac {39600}{2}\)
= ₹ 19,800
GST payable by retailer
= Output tax – ITC
= ₹ 39,600 – ₹ 32,400
= ₹ 7200
CGST payable by wholeseller = \(\large \frac {7200}{2}\) = ₹ 3600
Ans: CGST and SGST shown in the tax invoice of retailer is ₹ 19,800 and CGST is ₹ 3600 and SGST is ₹ 3600 payable by retailer
9. Anna Patil (Thane, Maharashtra) supplied vacuum cleaner to a shopkeeper in Vasai (Mumbai) for the taxable value of ₹ 14,000, and GST rate of 28%. Shopkeeper sold it to the customer at the same GST rate for ₹ 16,800 (taxable value). Find the following –
(1) Amount of CGST and SGST shown in the tax invoice issued by Anna Patil.
(2) Amount of CGST and SGST charged by the shopkeeper in Vasai.
(3) What is the CGST and SGST payable by the shopkeeper in Vasai at the time of filing the return.
Solution:
(1) All the transactions are done in Maharashtra.
For Anna Patil in Thane:
Taxable value of Vacuum Cleaner = ₹ 14,000
Rate of GST = 28%
∴ GST
= 28% of 14,000
= \(\large \frac {28}{100}\) × 14000
= ₹ 3920
∴ CGST (shown in the tax invoice of Anna Patil) = \(\large \frac {3920}{2}\) = ₹ 1960
Ans: Amount of CGST and SGST shown in the tax invoice issued by Anna Patil is ₹ 1960.
(2) For Shopkeeper in Vasai:
Input tax credit (ITC) for shopkeeper = ₹ 3920
Taxable value at which Vacuum cleaner sold to customer = ₹ 16,800
Rate of GST = 28%
∴ GST
= 28% of ₹ 16800
= \(\large \frac {28}{100}\) × 16800
= ₹ 4704
∴ CGST charged by shopkeeper
= \(\large \frac {4704}{2}\)
= ₹ 2352
Ans:Amount of CGST and SGST charged by the shopkeeper in Vasai is ₹ 2352.
(3) GST to be paid by shopkeeper at Vasai
= Output tax – ITC
= 4704 – 3920
= ₹ 784
∴ CGST to be paid by shopkeeper at
Vasai
= \(\large \frac {784}{2}\)
= ₹ 392
Ans: CGST and SGST payable by the shopkeeper in Vasai at the time of filing the return is ₹ 392.
10. For the given trading chain prepare the tax invoice I, II, III. GST at the rate of 12% was charged for the article supplied.
(1) Prepare the statement of GST payable under each head by the wholesaler, distributor and retailer at the time of filing the return to the government.
(2) At the end what amount is paid by the consumer ?
(3) Write which of the invoices issued are B2B and B2C ?
Solution:
(1) GST collected by wholesaler at the time of sale(Output tax)
= 12% of ₹ 5000
= \(\large \frac {12}{100}\) × 5000
= 600
∴ GST payable by distributor = ₹ 600
GST collected by distributor at the time of sale (Output tax)
= 12% of ₹ 6000
= \(\large \frac {12}{100}\) × 6000
= ₹ 720
∴ GST payable by distributor
= Output tax – ITC
= 720 – 600
= ₹ 120
GST collected by retailer at the time of sale (Output tax)
= 12% of ₹ 6500
= \(\large \frac {12}{100}\) × 6500
= ₹ 780
∴ GST payable by retailer
= Output tax – ITC
= 780 – 720
= ₹ 60
(2) Price at which article sold to customer
= Taxable value + GST
= 6500 + 780
= ₹ 7280
(3) The tax invoice between wholesaler and distributor is B2B type.
Also the tax invoice between distributor and retailer is B2B type.
The tax invoice between retailer and customer is B2C type.
Problem Set 4B
1. Write the correct alternative for each of the following.
(1) If the Face Value of a share is ₹ 100 and Market value is ₹75, then which of the following statements is correct ?
(A) The share is at premium of ₹ 175
(B) The share is at discount of ₹ 25
(C) The share is at premium of ₹ 25
(D) The share is at discount of ₹ 75
Ans: Option (B) : The share is at discount of ₹ 25.
(2) What is the amount of dividend received per share of face value ₹ 10 and dividend declared is 50%.
(A) ₹ 50
(B) ₹ 5
(C) ₹ 500
(D) ₹ 100
Ans: Option (B) : ₹ 5
(3) The NAV of a unit in mutual fund scheme is ₹ 10.65 then find the amount required to buy 500 such units.
(A) 5325
(B) 5235
(C) 532500
(D) 53250
Ans: Option (A) : 5325
(4) Rate of GST on brokerage is _____.
(A) 5%
(B) 12%
(C) 18%
(D) 28%
Ans: Option (C) : 18%
(5) To find the cost of one share at the time of buying the amount of Brokerage and GST is to be _____ the MV of share .
(A) added to
(B) subtracted from
(C) Multiplied with
(D) divided by
Ans: Option (A) : Added to
2. Find the purchase price of a share of FV ₹ 100 if it is at premium of ₹ 30. The brokerage rate is 0.3%.
Solution:
FV = ₹ 100 and Premium = ₹ 30
∴ MV
= FV + Premium
= 100 + 30
= ₹ 130
Brokerage per share
= 0.3% of ₹ 130
= \(\large \frac {0.3}{100}\) × 130
= ₹ 0.39
∴ Purchase price per share
= 130 + 0.39
= ₹ 130.39
Ans: The purchase price of one share is ₹ 130.39
3. Prashant bought 50 shares of FV ₹ 100, having MV ₹ 180. Company gave 40% dividend on the shares. Find the rate of return on investment.
Solution:
FV of share = ₹ 100
Dividend on one share
= 40% of ₹ 100
= \(\large \frac {40}{100}\) × 100
= ₹ 40
Dividend on 50 shares
= 50 × 40
= ₹ 2000
MV of share = ₹ 180
∴ Total investment
= 50 × 80
= ₹ 9000
∴ Rate of return
= \(\large \frac {Total \,dividend received}{Total\, investment}\) × 100
= \(\large \frac {2000}{9000}\) × 100
= 22.22 %
Ans: Rate of return = 22.22%
4. Find the amount received when 300 shares of FV ₹ 100, were sold at a discount of ₹ 30.
Solution:
FV of share = ₹ 100
Discount = ₹ 30
∴ MV
= FV – discount
= 100 – 30
= ₹ 70
∴ Market value of 1 share = ₹ 70
Total amount obtained by selling 300 shares
= 300 × 70
= ₹ 21000
Ans: The amount obtained by selling 300 shares is ₹ 21,000.
5. Find the number of shares received when ₹ 60,000 was invested in the shares of FV ₹ 100 and MV ₹ 120.
Solution:
MV of share = ₹ 120
Total investment = ₹ 60,000
∴ Number of shares
= \(\large \frac {Total\,investment}{MV}\)
= \(\large \frac {60000}{120}\)
= 500
Ans: The number of shares purchased is 500
6. Smt. Mita Agrawal invested ₹ 10,200 when MV of the share is ₹ 100. She sold 60 shares when the MV was ₹ 125 and sold remaining shares when the MV was ₹ 90. She paid 0.1% brokerage for each trading. Find whether she made profit or loss? and how much ?
Solution:
Amount invested by Mrs. Agarwal = ₹ 10,200
MV = ₹ 100
Brokerage per share
= 0.1% of ₹ 100
= \(\large \frac {0.1}{100}\) × 100
= ₹ 0.10
Purchase price per share
= MV + Brokerage
= 100 + 0.10
= ₹ 100.10
Number of shares purchased
= \(\large \frac {Amount\,invested}{Purchase\,price\,per\,share}\)
= \(\large \frac {10200}{100.10}\)
= 102 (approx.)
Number of shares sold at ₹ 125 per share = 60
∴ MV per share while selling 60 shares = ₹ 125
Brokerage per share
= 0.1% of ₹ 125
= \(\large \frac {0.1}{100}\) × 125
= ₹ 0.125
Total selling price per share
= MV – Brokerage
= 125 – 0.125
= ₹ 124.875
Amount received on selling 60 shares
= 60 × 124.875
= ₹ 7492.50
Remaining shares
= 102 – 60
= 42
MV per share while selling 42 shares = ₹ 90
Brokerage per share
= 0.1% of ₹ 90
= \(\large \frac {0.1}{100}\) × 90
= ₹ 0.09
Total selling price per share
= MV – brokerage
= 90 – 0.09
= ₹ 89.91
Amount received on selling 42 shares
= 42 × 89.91
= ₹ 3776.22
Net amount received
= Amount received on selling 60 shares + Amount received on selling 42 shares
= 7492.50 + 3776.22
= ₹ 11268.72
Here,
Net amount received > Amount invested
∴ There is a gain in the transaction.
Gain incurred
= Net amount received – Amount invested
= ₹ 11268.72 – ₹ 10200
= ₹ 1068.72
Ans: Mrs. Agarwal made a profit of ₹ 1068.72
7. Market value of shares and dividend declared by the two companies is given below. Face Value is same and it is ₹ 100 for both the shares. Investment in which company is more profitable ?
(1) Company A – ₹132 , 12%
(2) Company B – ₹144, 16%
Solution:
Suppose the amount invested in both the companies is ₹ 19,008 (i.e. ₹ 132 × ₹ 144)
For company A:
MV = ₹132
Dividend rate = 12%
Face value = ₹100
No of shares purchased
= \(\large \frac {Amount\,Invested}{MV}\)
= \(\large \frac {19008}{132}\)
= 144
Dividend per share
= Face value × rate
= 100 × 12%
= 100 × \(\large \frac {12}{100}\)
= ₹ 12
Dividend on shares
= Dividend per share × No. of share
= 144 × 12
= ₹ 1728
For company B:
MV = ₹ 19008
Dividend rate = 16%
Face value = ₹100
No of shares purchased
= \(\large \frac {Amount\,Invested}{MV}\)
= \(\large \frac {19008}{144}\)
= 132
Dividend per share
= Face value × rate
= 100 × 16%
= 100 × \(\large \frac {16}{100}\)
= ₹ 16
Dividend on shares
= Dividend per share × No. of share
= 16 × 132
= ₹ 2112
Now,
Company B gives more amount of dividend than company A
∴ Investment in company B is more profitable
7. A dealer supplied Walky-Talky set of ₹ 84,000 (with GST) to police control room. Rate of GST is 12%. Find the amount of state and central GST charged by the dealer. Also find the taxable value of the set.
Solution:
Rate of GST = 12%
If taxable value is ₹ 100, then total value including GST will be (100 + 12) = ₹ 112.
Similarly, if taxable value is ₹ x then total value including GST is ₹ 84,000.
∴ \(\large \frac {100}{x}\) = \(\large \frac {112}{84000}\)
∴ x = \(\large \frac {84000\,×\,100}{112}\)
∴ x = 75000
Rate of GST = 12%
∴ Rate of CGST is 6% and rate of SGST is 6%
CGST
= 6% of ₹ 75000
= \(\large \frac {6}{100}\) × 75000
= ₹ 4500
∴ CGST = SGST = ₹ 4500
Ans: The taxable value of Walky Talky sets is ₹ 75,000 and the amount of CGST is ₹ 4500 and SGST is ₹ 4500.
8. Shri. Aditya Sanghavi invested ₹ 50,118 in shares of FV ₹ 100, when the market value is ₹ 50. Rate of brokerage is 0.2% and Rate of GST on brokerage is 18%, then How many shares were purchased for ₹ 50,118 ?
Solution:
Market value of share = ₹ 50
Brokerage = 0.2%
Brokerage per share
= 0.2% of ₹ 50
= \(\large \frac {0.2}{100}\) × 50
= ₹ 0.10
GST on brokerage per share
= 18% of ₹ 0.10
= \(\large \frac {18}{100}\) × 50
= ₹ 0.018
Total purchase price per share
= Market value + Brokerage + GST
= 50 + 0.10 + 0.018
= ₹ 50.118
Number of shares purchased
= \(\large \frac {Amount\,Invested}{Purchase\,price\,per\,share}\)
= \(\large \frac {50118}{50.118}\)
= 1000
Ans: Mr. Sanghvi purchased 1000 shares.
9. Shri. Batliwala sold shares of ₹ 30,350 and purchased shares of ₹ 69,650 in a day. He paid brokerage at the rate of 0.1% on sale and purchase. 18% GST was charged on brokerage. Find his total expenditure on brokerage and tax.
Solution:
Shri Batliwala sold shares of ₹ 30,350
Brokerage paid while selling shares
= 0.1% of ₹ 30,350
= \(\large \frac {0.1}{100}\) × 30350
= ₹ 30.35
GST paid while selling shares
= 18% of ₹ 30.35
= \(\large \frac {18}{100}\) × 30.35
= ₹ 5.463
Also, he purchased shares of ₹ 69,650
Brokerage paid while purchasing shares
= 0.1% of ₹ 69,650
= \(\large \frac {0.1}{100}\) × 69650
= ₹ 69.65
GST paid while purchasing shares
= 18% of ₹ 69.65
= \(\large \frac {18}{100}\) × 69.65
= ₹ 12.537
Total brokerage paid in this transaction
= 30.35 + 69.65
= ₹ 100
Total GST paid in this transaction
= 5.463 + 12.537
= ₹ 18
Total expenditure on brokerage and tax
= 100 + 18
= ₹ 118
Ans: Total expenditure on brokerage and tax is ₹ 118.
10. Smt. Aruna Thakkar purchased 100 shares of FV 100 when the MV is ₹ 1200. She paid brokerage at the rate of 0.3% and 18% GST on brokerage.
Find the following –
(1) Net amount paid for 100 shares.
(2) Brokerage paid on sum invested.
(3) GST paid on brokerage.
(4) Total amount paid for 100 shares.
Solution:
MV = ₹ 1200 and number of shares purchased = 100
∴ Net amount paid for 100 shares
= 1200 × 100
= ₹ 1,20,000
Brokerage = 0.3%
Brokerage per share
= 0.3% of ₹ 1200
= \(\large \frac {0.3}{100}\) × 1200
= ₹ 3.6
∴ Brokerage on 100 shares
= 100 × 3.6
= ₹ 360
GST per share
= 18% of ₹ 3.6
= \(\large \frac {18}{100}\) × 3 6.
= ₹ 0.648
GST on 100 shares
= 100 × 0.648
= ₹ 64.80
Total purchase price per share
= MV + brokerage + GST
= 1200 + 3.6 + 0.648
= ₹ 1204.248
Total purchase price of 100 shares
= 100 × 1204.248
= ₹ 1,20,424.80
Ans:
(1) Net amount paid for 100 shares is ₹ 1,20,000.
(2) Brokerage paid on sum invested is ₹ 360.
(3) GST paid on brokerage is ₹64.80.
(4) Total amount paid for 100 shares is ₹ 1,20,424.80
11. Smt. Anagha Doshi purchased 22 shares of FV ₹ 100 for Market Value of ₹ 660. Find the sum invested. After taking 20% dividend, she sold all the shares when market value was ₹ 650. She paid 0.1% brokerage for each trading done. Find the percent of profit or loss in the share trading. (Write your answer to the nearest integer.)
Solution:
Number of shares purchased = 22
MV = ₹ 660
∴ Brokerage per share
= 0.1% of ₹ 660
= \(\large \frac {0.1}{100}\) × 660
= ₹ 0.66
Purchase price per share
= MV + Brokerage
= 660 + 0.66
= ₹ 660.66
Purchase price of 22 shares
= 22 × 660.66
= ₹ 14534.52
FV = ₹ 100
Dividend per share
= 20% of ₹ 100
= \(\large \frac {20}{100}\) × 100
= ₹ 20
∴ Dividend on 22 shares
= 22 × 20
= ₹ 440
MV per share while selling = ₹ 650
Brokerage per share
= 0.1% of ₹ 650
= \(\large \frac {0.1}{100}\) × 650
= ₹ 0.65
Total selling price per share
= MV – Brokerage
= 650 – 0.65
= ₹ 649.35
Total selling price of 22 shares
= 22 × 649.35
= ₹ 14,285.70
Amount invested = ₹ 14,534.52
Total amount received
= Dividend + Selling Price
= 440 + 14285.70
= ₹ 14,725.70
∴ Amount received > Amount invested
∴ There is a profit in the transaction
Profit
= Amount received – Amount invested
= 14725.70 – 14534.52
= ₹ 191.18
Profit percent
= \(\large \frac {Profit}{Amount\,invested}\) × 100
= \(\large \frac {191.18}{14534.52}\)
= 1.32 ≈ 1% (approx)
Profit percent = 1%
Ans: Mrs. Anagha Doshi invested ₹ 14,534.52 and got profit of 1%.