taxi question

Quantitative Finance Level 2

Sam went to the stationers and bought things worth rupees 25, out of which 30 paise went on sales tax on taxable purchases.If the tax rate was 6%,then what was the cost of the tax free items?

(1 rupee =100 paise)

Give your answer in rupees.


The answer is 19.70.

Siddharth Singh by Siddharth Singh , 20, India

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2 solutions

Titas Biswas
Jul 19, 2015

I entered 20 and the answer was accepted to be correct.So,I'll be putting the solution according to the answer I have given. 30 paise is sales tax,which was derived on 6% tax rate.Therefore,6/100 * x = 30 or x = 500 paise or Rs.5.Therefore,the cost of tax free items has to be Rs.(25-5) = Rs.20.

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Can you explain how you got 19.70?

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Total amount paid (inclusive of taxes)= 25 \displaystyle 25

Actual cost of items= 25 − 0.30 = 24.70 \displaystyle 25 - 0.30=24.70

Taxable purchases had actual cost 5 \displaystyle 5 .

Therefore, cost of tax-free purchases= 24.70 − 5 = 19.70 \displaystyle 24.70 - 5 = \boxed{19.70}

Harsh Khatri - 5 years, 4 months ago

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