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Profit Loss Involving Tax

We will discuss here how to solve the problems based on Profit loss involving tax.

1. A shopkeeper buys a DVD player at a rebate of 20% on the printed price. He spends $ 20 on transportation of the DVD player. After changing a sales tax 6% on the printed price, he sells the DVD player at $530. Find his profit percentage.

Solution:

Let the printed price be P. Then, the cost price = P – 20% of P

                                                                    = P – 20P100 

                                                                    = 4P5.

Actual cost price including transportation cost = 4P5 + $ 20.

The sales tax = 6% of P = 6P100 = 3P50

Therefore, the selling price including sales tax = P + 3p50

According to the problem,

P + 3P50 = 53P50 = $ 530

53P50 = $ 530

Therefore, P = $ 500

Therefore, the actual cost price = 4P5 + $ 20 = 4×$5005 + $ 20 = $ 420.

Therefore, profit = printed price – actual cost price = $ 500 - $ 420 = $ 80.

Therefore, profit percentage = $80$420 × 100% = 40021% = 19121 %.

 

2. A seller buys a LED Televisions for $ 2500 and marks up its price. A customer buys the LED Televisions for $ 3,300 which includes a sales tax of 10% on the marked up price.

(i) Find the mark-up percentage on the price of the LED Televisions.

(ii) Find his profit percentage.

Solution:

Let the marked up price be P. Then, the sales tax = 10% of P = P/10.

Therefore, selling price = P + P10

According to the problem, = $ 3300

Or, P ∙ 1110 = $ 3300

Therefore, P = $ 3000.

Therefore, $ 2500 is marked up to $ 3000

Therefore, mark-up percentage = $300$25002500 × 100%

                                               = 5002500 × 100%

                                               = 20%

Now, the profit = marked up price – cost price = $ 3000 - $ 2500 = $ 500

Therefore, profit percentage = $500$2500 × 100% = 20%

● Sales Tax and Value Added Tax



10th Grade Math

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