Multiple Choice Questions If inventory was purchased for $2 288 inclusive of GST, what would the GST amount be? $22.88$229.00$208.00$20.80

Answered: If inventory was purchased for $2 288…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Multiple Choice Questions

If inventory was purchased for $2 288 inclusive of GST, what would the GST amount be?

$22.88
$229.00
$208.00
$20.80

Expert Solution

Step 1 < Introduction>

Goods and Services Tax (GST) : GST is a summation of all indirect taxes which a customer have to pay if they buy goods or services or both such as food , clothes ,transportation etc. It replaces all the indirect taxes levid on goods and services by the central and state governments.

GST calculation can be explained by simple illustration : If a goods or services is sold at Rs. 1,000 and the GST rate applicable is 18%, then the net price calculated will be = 1,000+ (1,000X(18/100)) = 1,000+180 = Rs. 1,180.

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