Selina Concise Solutions for ICSE Class 10 Mathematics Chapter 1 Gst Goods And Services Tax

Question 1. For the following transaction within Delhi, fill in the blanks to find the amount of bill:
MRP = Rs. 12,000, Discount % = 30%, GST = 18%
Discount =
Selling price (discounted value) =
CGST =
SGST =
IGST =
Amount of Bill =

Answer:
Given:
MRP = Rs. 12,000, Discount % = 30%, GST = 18%

Step 1: Find discount amount.
Discount = 30% of 12,000 = \( \frac{30}{100} \times 12,000 = \text{Rs. } 3,600 \)

Step 2: Find selling price after discount.
Selling price (discounted value) = 12,000 – 3,600 = Rs. 8,400

Step 3: Find CGST and SGST (within same state).
CGST = 9% of 8,400 = Rs. 756
SGST = 9% of 8,400 = Rs. 756
IGST = 0 (not applicable for intra-state transaction)

Step 4: Find total bill amount.
Amount of Bill = Selling price + CGST + SGST = 8,400 + 756 + 756 = Rs. 9,912
In simple words: Within same state, GST is split equally into CGST and SGST. We first take discount, then add GST on the discounted price.

📝 Teacher's Note: Explain that within same state means CGST + SGST. Between different states means only IGST. Students often forget to split 18% into 9% + 9% for same state.

🎯 Exam Tip: Always check if transaction is intra-state (same state) or inter-state (different states). This decides CGST+SGST or IGST. Show all steps clearly.

Question 2. For the following transaction from Delhi to Jaipur, fill in the blanks to find the amount of bill:
MRP = Rs. 50,000, Discount % = 20%, GST = 28%
Discount =
Selling price (discounted value) =
CGST =
SGST =
IGST =
Amount of Bill =

Answer:
Given:
MRP = Rs. 50,000, Discount % = 20%, GST = 28%

Step 1: Find discount amount.
Discount = 20% of 50,000 = \( \frac{20}{100} \times 50,000 = \text{Rs. } 10,000 \)

Step 2: Find selling price after discount.
Selling price (discounted value) = 50,000 – 10,000 = Rs. 40,000

Step 3: Find IGST (between different states).
CGST = 0
SGST = 0
IGST = 28% of 40,000 = \( \frac{28}{100} \times 40,000 = \text{Rs. } 11,200 \)

Step 4: Find total bill amount.
Amount of Bill = Selling price + IGST = 40,000 + 11,200 = Rs. 51,200
In simple words: Delhi to Jaipur means different states. So we use only IGST, not CGST and SGST.

📝 Teacher's Note: Delhi is a state and Rajasthan is another state. Between different states, only IGST applies. CGST and SGST become zero.

🎯 Exam Tip: Write "inter-state transaction" clearly in your answer. Then write CGST = 0, SGST = 0, and calculate full GST as IGST.

Question 3. A computer mechanic in Delhi charges repairing cost from five different persons A, B, C, D and E with certain discounts. The repairing costs and the corresponding discounts are as given below:

If the rate of GST is 18%, find the total money (including GST) received by the mechanic.

Answer:

The total money (including GST) received by the mechanic is 18,820 + 1693.8 + 1693.8 = Rs. 22,207.6
In simple words: We calculate discount and GST for each person separately. Then add all amounts together to get the total money the mechanic receives.

📝 Teacher's Note: Make students do one row completely first, then repeat for others. Common mistake is adding GST to original price instead of discounted price.

🎯 Exam Tip: Make a proper table with all columns. Show total of selling price, CGST and SGST separately. Then add them for final answer.

Question 4. Find the amount of bill for the following intra-state transaction of goods/services. The GST rate is 5%.

Answer:

Amount of bill = Selling price + GST = 10,290 + 257.25 + 257.25 = Rs. 10,804.5
In simple words: We find total cost for each type of item. Then take discount. Then add 2.5% CGST and 2.5% SGST on the discounted price.

📝 Teacher's Note: Explain that 5% GST splits into 2.5% CGST and 2.5% SGST for intra-state. Students must multiply quantity with MRP first.

🎯 Exam Tip: Always calculate total MRP (quantity × MRP per item) first. Then apply discount. Then calculate GST on selling price, not on MRP.

Question 5. Find the amount of bill for the following inter-state transaction of goods/services. The GST rate is 18%.

Answer:

Amount of bill = Selling price + CGST + SGST = 44,210 + 3978.9 + 3978.9 = Rs. 52,167.8
In simple words: This is inter-state, but the table shows CGST and SGST. This means the transaction is treated as intra-state. GST 18% splits into 9% CGST and 9% SGST.

📝 Teacher's Note: Sometimes the question format can be confusing. Check if CGST+SGST or IGST is asked in the solution table to know the correct approach.

🎯 Exam Tip: Read the question carefully. If it asks for CGST and SGST in the table, calculate them even if the heading says inter-state. Follow the table format given.

Question 6. Find the amount of bill for the following intra-state transaction of goods/services.

Answer:

Amount of bill = Selling price + CGST + SGST = 37,850 + 2785 + 2785 = Rs. 43,420
In simple words: Different items have different GST rates. SGST equals CGST for intra-state transactions. We add all amounts at the end.

📝 Teacher's Note: Show students that different goods can have different GST rates. CGST and SGST are always equal in intra-state transactions.

🎯 Exam Tip: When CGST rates are given, SGST will be the same rate. Make separate columns for each tax component and add them properly.

Question 7. Find the amount of bill for the following inter-state transaction of goods/services.

Answer:

Amount of bill = Selling price + GST = 37,850 + 5570 = Rs. 43,420
In simple words: For inter-state, we use IGST. The IGST rate is double the CGST rate. So if CGST is 6%, IGST is 12%.

📝 Teacher's Note: Explain that for inter-state transactions, IGST = CGST + SGST. So if CGST is 6%, then total GST is 12% as IGST.

🎯 Exam Tip: For inter-state, convert CGST % to IGST % by doubling it. Write clearly "IGST = CGST + SGST" in your working.

Question 8. A dealer in Mumbai supplied an item at the following prices to a dealer in Delhi. Find the total amount of the bill.

Answer:
Mumbai to Delhi is inter-state transaction, so we use IGST = CGST + SGST = 9% + 9% = 18%

Total amount of bill = Selling price + IGST = 17,710 + 3187.8 = Rs. 20,897.8
In simple words: "Net" means no discount. Mumbai and Delhi are different states, so we use IGST instead of CGST and SGST.

📝 Teacher's Note: Explain that "Net" means no discount given. Mumbai is in Maharashtra, Delhi is in Delhi - different states, so IGST applies.

🎯 Exam Tip: When you see "Net" discount, write 0% discount. Always identify if transaction is inter-state or intra-state first. This decides tax type.

Question 8. [Continued from previous table solution]
Answer:
Amount of bill = Selling price + IGST
= 17,710 + 3187.8
= Rs. 20,897.8
In simple words: We add the selling price and the tax (IGST) to get the total bill amount. This is what the customer pays.

📝 Teacher's Note: Show students a real bill from a shop. Point out how the total is always price plus tax. This makes GST calculation easy to understand.

🎯 Exam Tip: Always write the formula first: "Amount of bill = Selling price + GST". Then substitute values. Don't forget to write "Rs." with the final answer.

Question 9. National Trading Company, Meerut (UP) made the supply of the following goods/services to Samarth Traders, Noida (UP). Find the total amount of bill if the rate of GST = 12%
Answer:

Amount of bill = Selling price + SGST + CGST
= 17,220 + 2066.4
= Rs. 19,286.4
In simple words: Both companies are in UP (same state). So we use SGST and CGST, each at 6%. Total GST = 12%.

📝 Teacher's Note: Explain that intra-state trade (within same state) uses SGST + CGST. Inter-state trade uses only IGST. Use a map to show this clearly.

🎯 Exam Tip: Check the states first. Same state = SGST + CGST. Different states = IGST. Write this check in your working to show the examiner you understand.

Question 10. M/s Ram Traders, Delhi, provided the following services to M/s Geeta Trading Company in Agra (UP). Find the amount of bill:
Answer:

Amount of bill = Selling price + IGST
= 18,600 + 2007.2
= Rs. 20,607.2
In simple words: Delhi and UP are different states. So we use IGST (not SGST + CGST). Different services have different GST rates.

📝 Teacher's Note: Show students that different types of services have different GST rates. Explain that some are essential (low rate) and some are luxury (high rate).

🎯 Exam Tip: When states are different, always use IGST. Write "Inter-state transaction" to show you know the rule. Calculate each service separately, then add up.

Question 11. For the following, find the amount of bill data:
Answer:

Amount of bill = Selling price + GST
= 15,168 + 2634.24
= Rs. 17,802.24
In simple words: We calculate MRP first, then apply discount to get selling price. Then we add GST on the selling price to get the final bill.

📝 Teacher's Note: Teach the sequence: MRP → Discount → Selling Price → GST → Final Bill. Make students write each step clearly. Use a shopping example.

🎯 Exam Tip: Always calculate in order: MRP, then selling price after discount, then GST on selling price. Don't calculate GST on MRP - that's wrong!

Question 12. The tax invoice of a telecom service in Meerut shows cost of services provided by it as Rs. 750. If the GST rate is 18%, find the amount of the bill.
Answer:
According to the question,
GST = 18% of 750
= \(\frac{18}{100}\) × 750 = Rs. 135
The amount of bill = 750 + 135 = Rs. 885
In simple words: The service costs Rs. 750. We add 18% tax on this amount. So total bill = service cost + tax.

📝 Teacher's Note: Use a mobile phone bill as example. Show students how the basic charge and GST are shown separately, then added for total bill.

🎯 Exam Tip: Write "GST = 18% of 750" clearly. Show the percentage calculation. Always add GST to the base amount for final bill.

Question 13. Mr. Pankaj took Health Insurance Policy for his family and paid Rs. 900 as SGST. Find the total annual premium paid by him for this policy, rate of GST being 18%.
Answer:
Let the total annual premium paid by Mr. Pankaj be Rs. x. According to the question,
18% of x = SGST + CGST
18% of x = 1800 (since SGST = CGST = 900)
\(\frac{18}{100}\) × x = 1800
x = Rs. 10,000
In simple words: If SGST is Rs. 900, then CGST is also Rs. 900. Total GST = Rs. 1800. This is 18% of the premium amount.

📝 Teacher's Note: Explain that SGST and CGST are always equal in intra-state transactions. So if one is given, the other is the same amount.

🎯 Exam Tip: When only SGST is given, remember CGST = SGST. Total GST = SGST + CGST. Then use percentage formula to find the base amount.

Question 14. Mr. Malik went on a tour to Goa. He took a room in a hotel for two days at the rate of Rs. 5000 per day. On the same day, his friend John also joined him. Hotel provided an extra bed charging Rs. 1000 per day for the bed. How much GST, at the rate of 28% is charged by the hotel in the bill to Mr. Malik for both the days?
Answer:
According to the question,
The amount of bill = 5000 × 2 + 1000 + 1000
= 10,000 + 2000
= Rs. 12,000
GST = 28% of 12,000
= \(\frac{28}{100}\) × 12,000 = Rs. 3360
GST charged by Mr. Malik Rs. 3360.
In simple words: Room for 2 days = Rs. 10,000. Extra bed for 2 days = Rs. 2000. Total = Rs. 12,000. GST = 28% of this total.

📝 Teacher's Note: Show students how hotel bills work. Room charge + extra services = total before tax. Then GST is added to this total.

🎯 Exam Tip: Calculate total service amount first. Then apply GST percentage. Write each step clearly: room cost + extra bed cost = total, then GST calculation.

Question 15. Asharaf went to see a movie. He wanted to purchase a movie ticket for Rs. 80. As the ticket for Rs. 80 was not available, he purchased a ticket for Rs. 120 of upper class. How much extra GST did he pay for the ticket? (GST for a ticket below Rs. 100 is 18% and GST for a ticket above Rs. 100 is 28%)
Answer:
According to the question,
GST on ticket of Rs. 80 = 18% of 80 = \(\frac{18}{100}\) × 80 = Rs. 14.40
GST on ticket of Rs. 120 = 28% of 120 = \(\frac{28}{100}\) × 120 = Rs. 33.60
Difference between both GST
= 33.60 – 14.40
= Rs. 19.20
In simple words: Cheaper tickets have lower GST (18%). Expensive tickets have higher GST (28%). The difference is the extra GST paid.

📝 Teacher's Note: Explain that government puts higher tax on luxury items (expensive movie tickets) and lower tax on regular items. This is the policy behind GST rates.

🎯 Exam Tip: Calculate GST for both tickets separately. Then find the difference. Don't forget that different price ranges have different GST rates.

GST Exercise

Question 1. Fill in the blanks: When the goods/services are sold for Rs. 15,000 under intra-state transaction from station A to station B and the rate of GST is 12%.
Answer:
As per GST System
S.P. at station A = Rs. 15,000
CGST = 6% of 15,000 = Rs. 900
SGST = 6% of 15,000 = Rs. 900
C.P. at station B = Rs. 15,000
If profit = Rs. 5000
S.P. at station B = 15,000 + 5000 = Rs. 20,000

Now the same goods/services are moved under inter-state transaction from station B to station C and the rate of tax is 12%.
GST = 12% of 20,000 = Rs. 2400
C.P. at station C = Rs. 20,000
In simple words: Intra-state uses CGST + SGST. Inter-state uses only IGST. Cost price stays same but selling price can be different due to profit.

📝 Teacher's Note: Draw a map showing states A, B, C. Show how intra-state (within state) and inter-state (between states) transactions work differently.

🎯 Exam Tip: Remember: same state = CGST + SGST (each is half of total GST). Different state = only IGST (full GST rate). Cost price for buyer = selling price of seller.

Question 2. Goods/services are sold from Agra (U.P.) to Kanpur (U.P.) for Rs. 20,000 and then from Kanpur to Jaipur (Rajasthan). If the rate of GST is 18% and the profit made at Kanpur is Rs. 5000, find:
(i) the net GST payable by the dealer at Kanpur.
(ii) the cost of goods/services at Jaipur.
Answer:
When the product is sold from Agra to Kanpur (intra-state transaction)
For the dealer in Agra:
S. P. in Agra = Rs. 20,000
CGST = 9% of Rs. 20,000 = \(\frac{9}{100}\) × 20,000 = 1800
SGST = 9% of Rs. 20,000 = \(\frac{9}{100}\) × 20,000 = 1800

When product is sold from Kanpur to Jaipur (inter-state transaction)
For the dealer in Kanpur
Input-tax credit = 1800 + 1800 = Rs. 3600

📝 Teacher's Note: Explain input tax credit - dealer can use the GST he paid while buying to reduce the GST he owes while selling. This avoids double taxation.

🎯 Exam Tip: Input tax credit = CGST paid + SGST paid when buying. This amount can be subtracted from GST owed when selling. Always show this calculation clearly.

Question 3.
Goods/services are sold from Kota (Rajasthan) to Mumbai for Rs. 20,000 and then from Mumbai to Pune. If the rate of GST is 12% and the profit made at Mumbai is Rs. 5000; find the net GST paid at Pune, if the dealer at Pune is the end-user.
Answer:
For the dealer in Mumbai (inter-state transaction)
CP = Rs. 20,000
IGST = 12% of Rs. 20,000 = \( \frac{12}{100} \) × 20,000 = Rs. 2400
Profit = Rs. 5000
SP = Rs. 25,000

For the dealer in Pune (intra-state transaction)
CP = Rs. 25,000
CGST = 6% of 25,000 = Rs. 1500
SGST = 6% of 25,000 = Rs. 1500
GST payable by the end user at Pune = 1500 + 1500= Rs. 3000
In simple words: The Mumbai dealer pays IGST when buying from another state. The Pune dealer (end user) pays CGST and SGST because he does not sell further.

📝 Teacher's Note: Show students that when goods move between states, IGST is used. When goods stay in same state, CGST + SGST is used. End user means the person who does not sell the goods again.

🎯 Exam Tip: Always write "end user pays full GST" because there is no output tax to subtract. Calculate CGST and SGST separately for intra-state transactions.

Question 4.
A is a dealer in Banaras (U.P.). he supplies goods/services worth Rs. 8000 to a dealer B in Agra (U.P.). Dealer B, in turn, supplies the same goods/services to dealer C in Patna (Bihar) at a profit of Rs. 1200. Find the input and output taxes for the dealer C under GST system; if the rate of GST is 18% and C does not sell his goods/services further.
Answer:
For the dealer A (intra-state transaction)
SP = Rs. 8,000

For the dealer B (intra-state transaction)
CP = Rs. 8,000
CGST = 9% of 8,000 = Rs. 720
SGST = 9% of 8,000 = Rs. 720
Profit = Rs. 1,200
SP = Rs. 9,200

For the dealer C (inter-state transaction)
CP = Rs. 9,200
IGST = 18 % of Rs. 9,200 = \( \frac{18}{100} \) × 9,200 = Rs. 1656
Input Tax = Rs. 1,656
Since, the dealer in Patna does not sell the product.
Output GST (tax on sale) = Rs. 0
In simple words: Dealer C buys goods from another state so pays IGST. Since C does not sell further, his output tax is zero.

📝 Teacher's Note: Explain that input tax is what you pay when buying. Output tax is what you collect when selling. If you don't sell, output tax is zero.

🎯 Exam Tip: For end users, always write "Output tax = Rs. 0" clearly. Input tax equals the IGST paid when buying from another state.

Question 5.
A is a dealer in Meerut (U.P.). He supplies goods/services, worth Rs. 15,000 to a dealer B in Ratlam (M.P.). Dealer B, in turn, supplies the same goods/services to dealer C in Jabalpur (M.P.) at a profit of Rs. 3000. If rate of tax (under GST system) is 18%, find
• The cost of goods/services to the dealer C in Jabalpur.
• Net tax payable by dealer B.
Answer:
For A (case of inter-state transaction)
S.P. in Meerut = Rs. 15,000

For B (case of inter-state transaction)
C.P. = Rs. 15,000
IGST = 18% of 15,000 = \( \frac{18}{100} \) × 15,000 = Rs. 2700
Input tax for B = Rs. 2,700
C.P. in Ratlam = Rs. 15,000 and profit = Rs. 3000
S.P. in Ratlam = 15,000 + 3000 = Rs. 18,000

For C (case of intra-state transaction)
C.P. = Rs. 18,000
CGST = 9% of 18,000 = \( \frac{9}{100} \) × 18,000 = Rs. 1620
SGST = \( \frac{9}{100} \) × 18,000 = Rs. 1620

Net GST payable by the dealer B
= Output tax – Input tax
= 1620 + 1620 – 2700
= Rs. 540

C.P. for the dealer C in Jabalpur
= S.P. for the dealer in Ratlam + GST
= 18,000 + 1620 + 1620
= Rs. 21,240
In simple words: Dealer B pays less tax because he can subtract what he paid when buying (input tax) from what he collects when selling (output tax).

📝 Teacher's Note: Draw a simple flow chart: A → B → C. Show how tax flows through the chain. The net tax is always output minus input.

🎯 Exam Tip: Always calculate: Net GST = Output tax - Input tax. For cost to next dealer, add selling price + all GST components.

Question 6.
A dealer X in Hapur (U.P.) supplies goods/services, worth Rs. 50,000 to some other dealer Y in the same city. Now the dealer Y supplies the same goods/services to dealer Z in Calcutta at a profit of Rs. 20,000. Find
• Output and input taxes for the dealer Y
• Net GST payable by dealer Y.
The rate of GST at each stage is 28%
Answer:
For the dealer X (intra-state transaction)
SP = Rs. 50,000

For the dealer Y (intra-state transaction)
CP = Rs. 50,000
CGST = 14% of 50,000= Rs. 7,000
SGST = 14% of 50,000= Rs. 7,000
Input tax for dealer Y = Rs. 14,000
Profit = Rs. 20,000
SP = Rs. 70,000

For the dealer Z (inter-state transaction)
CP = Rs. 70,000
IGST = 28 % of Rs. 70,000 = \( \frac{28}{100} \) × 70,000 = Rs. 19,600
∴ Input Tax = Rs. 19,600 which is the output tax for dealer Y.

Net GST payable for Y
= Output tax for Y – Input tax for Y
= 19,600 – 14,000
= Rs. 5600
In simple words: Dealer Y collects IGST when selling to another state but paid CGST + SGST when buying in same state. The difference is what he pays to government.

📝 Teacher's Note: Explain that Y's output tax becomes Z's input tax. This is how the tax chain works - one person's output becomes another's input.

🎯 Exam Tip: When selling to another state, collect IGST. When buying in same state, pay CGST + SGST. Net tax = Output - Input.

Question 7.
Consultancy services, worth Rs. 50,000, are transferred from Delhi to Calcutta at the rate of GST 18% and then from Calcutta to Nainital (with profit = Rs. 20,000) at the same rate of GST. Find the output tax at
• Delhi
• Calcutta
• Nainital
Answer:
Output tax in Delhi (interstate):
IGST = 18% of 50,000 = Rs. 9000
Output tax in Delhi = Rs. 9000

Output tax in Calcutta:
C.P. in Calcutta = Rs. 50,000 and Profit = Rs. 20,000
S.P. in Calcutta = 50,000 + 20,000 = Rs. 70,000
IGST = 18% of 70,000 = Rs. 12,600
Output tax in Calcutta = Rs. 12,600

Since, the dealer in Nainital does not sell the product.
Output GST (tax on sale) = Rs. 0
In simple words: Delhi and Calcutta collect tax when they sell. Nainital does not sell, so no output tax.

📝 Teacher's Note: Remind students that output tax means tax collected when selling. If you don't sell, there is no output tax to collect.

🎯 Exam Tip: Output tax = GST rate × Selling price. If dealer does not sell further, output tax = 0. Write this clearly in exam.

Question 8.
For a dealer A, the list price of an article is Rs. 9000, which he sells to dealer B at some lower price. Further, dealer B sells the same article to a customer at its list price. If the rate of GST is 18% and dealer B paid a tax, under GST, equal to Rs. 324 to the government, find the amount (inclusive of GST) paid by dealer B.
Answer:
Let A sells to dealer B at Rs. x lower price.
According to the question,
Net Tax paid by dealer B is
⇒ Output tax – Input Tax = Rs. 324
⇒ 18% of 9000 – 18% of (9000 – x) = 324
⇒ 1620 – 1620 + 18% of x = 324
⇒ 18% of x = 324
⇒ x = 1800

Hence, selling price of B = 9000 – 1800 = Rs. 7200
The amount (inclusive of GST) paid by dealer B
= 7200 + 18% of 7200
= 7200 + 1296
= Rs. 8496
In simple words: We find the discount amount by using the net tax paid. Then we calculate the price B paid including GST.

📝 Teacher's Note: Show students that net tax paid = GST rate × discount amount. This helps find the actual buying price of dealer B.

🎯 Exam Tip: Set up equation: Output tax - Input tax = Net tax paid. Solve for the unknown discount amount. Then add GST to find inclusive price.

Question 9.
The marked price of an article is Rs. 6000. A wholesaler sells it to a dealer at 20% discount. The dealer further sells the article to a customer at a discount of 10% on the marked price. If the rate of GST at each stage is 18%, find the amount of tax (under GST) paid by the dealer to the government.
Answer:
Initial marked price by manufacturer A is Rs. 6000
B bought the T.V. at a discount of 20%.
Cost price of B = 80% of 6000 = Rs. 4800 ....(i)
GST paid by B for purchase = 18% of 4800 = Rs. 864 ....(ii)
B sells T.V. at discount of 10% of market Price
Selling price for B = 6000 – 10% of 6000 = Rs. 5400 ...(iii)
GST charged by B on selling of T.V. = 18% of 5400 = Rs. 972 ...(iv)
GST paid by B to the government
= GST charged on selling price – GST paid against purchase price
= 972 – 864
= Rs. 108
In simple words: The dealer pays the difference between GST collected from customer and GST paid to supplier. This is the net amount going to government.

📝 Teacher's Note: Use real examples like a mobile phone or TV. Show how discounts affect the price but GST is always calculated on actual selling price.

🎯 Exam Tip: Calculate cost price after discount, then GST on that. Calculate selling price after discount, then GST on that. Net GST = Output GST - Input GST.

Question 10.
A is a manufacturer of T.V. sets in Delhi. He manufacturers a particular brand of T.V. set and marks it at Rs. 75,000. He then sells this T.V. set to a wholesaler B in Punjab at a discount of 30%. The wholesaler B raises the marked price of the T.V. set bought by 30% and then sells it to dealer C in Delhi. If the rate of GST = 5% find tax (under GST) paid by wholesaler B to the government.
Answer:
Initial marked price by manufacturer A is Rs. 75,000
B bought the T.V. at a discount of 30%.
Cost price of B = 70% of 75,000 = Rs. 52,500 ....(i)
GST paid by B for purchase = 5% of 52,500 = Rs. 2625 ....(ii)
In simple words: B gets discount when buying, but raises price when selling. The tax paid is calculated on the difference between what he collects and what he paid.

📝 Teacher's Note: Explain that wholesalers often get discounts when buying but sell at higher prices. The GST is always on actual transaction amounts.

🎯 Exam Tip: Be careful with percentage calculations. Discount of 30% means pay 70%. Raise by 30% means new price = 130% of cost price.

Question 11. For a trader, marked price of a refrigerator = Rs. 15,680 inclusive of GST at the rate of 12% on the marked price. Gagan, a customer for this refrigerator, asks the trader to reduce the marked price of the refrigerator to such extend that its reduced price plus GST on it is equal to marked price of the refrigerator. Find the required reduction.
Answer:
Given:
Marked price including GST = Rs. 15,680
GST rate = 12%

Step 1: Find the actual marked price (without GST)
Let the marked price be Rs. x.
\( x + 12\% \text{ of } x = 15,680 \)
\( 1.12x = 15,680 \)
\( x = \text{Rs. } 14,000 \)

Initial marked price = Rs. 14,000

Step 2: Set up equation for reduced price
Let Gagan asked for price reduction of Rs. y.
New price = 14,000 – y
GST on new price = 12% of (14,000 – y)

Step 3: Apply the condition
According to the question,
New price + GST on new price = Original marked price
\( 14,000 - y + 0.12(14,000 - y) = 14,000 \)
\( 14,000 - y + 1,680 - 0.12y = 14,000 \)
\( -1.12y + 1,680 = 0 \)
\( y = 1,500 \)

Required reduction in price is Rs. 1,500.
In simple words: First we find the real price without GST. Then we find how much to reduce so that the new price plus its GST equals the original price.

📝 Teacher's Note: Show students that when GST is included, we divide by 1.12 to get the base price. Common mistake is to subtract 12% directly from the total.

🎯 Exam Tip: Always write "Let x be the marked price" first. Show each step clearly. The final equation should have the reduction amount on one side.