GST

 GST                           Sums for practice👈

What is GST?

GST (Goods and Services Tax) is an indirect tax applied on the sale of goods and services.
It is added to the taxable amount (after any discounts).

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🔹 Important Terms to Understand:

Term	Meaning
List Price (Marked Price)	Price printed on the product (before any discount)
Discount	Reduction offered on the list price
Selling Price (SP)	Price after applying discount, before adding GST
GST	Tax calculated on the discounted price
Final Price	SP + GST (this is the amount paid by the customer)

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🧮 Formulas to Remember

1. Discount Amount

Discount = Discount %*List Price

2. Selling Price (after discount)

$$\text{SP} = \text{List Price} - \text{Discount}$$

3. GST Amount

GST = GST%SP

4. Final Price (Amount to be Paid)

$$\text{Final Price} = \text{SP} + \text{GST}$$

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Step-by-Step Example

The manufacturing cost of an item is ₹ 9000. The manufacturer marked up the price of his items by 60% and then sold them at a discount of 10%. If a consumer buy 10 such items, when the rate of GST is 10% then the GST paid by him on the purchased is:

Options

(a) ₹ 648
(b) ₹ 1,000
(c) ₹ 12,960
(d) ₹ 1,425

Ans. (c) ₹ 12,960
Explanation:
C.P. of an item =₹ 9000
Marked price of an item
= ₹9000 + 60% of ₹ 9000
= ₹ 14,400

Discounted price of an item
=₹14,400−10% of ₹ 14,400
=₹12,960
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⇒ Discounted price of 10 such items
= ₹ 1,29,600
∵Rate of GST = 10 %
∴CGST = SGST =5 % of ₹ 1,29,600
=₹6480

So,
GST = CGST + SGST
=₹6480+₹6480
=₹12,960.