The rate of VAT on the vacuum cleaner is 15%
How to determine the rate of VAT?
The given parameters are:
Selling price = Rs 12000
Discount = 12%
Amount Paid = 12144
The amount paid is calculated as:
Amount Paid = Selling Price * (1 - Discount) * (1 + VAT)
So, we have
12144 = 12000 * (1 - 12%) * (1 + VAT)
Evaluate the difference
12144 = 12000 * 0.88 * (1 + VAT)
Evaluate the product
12144 = 10560 * (1 + VAT)
Divide both sides by 10560
1.15 = (1 + VAT)
Subtract 1 from both sides
VAT = 0.15
Express as percentage
VAT = 15%
Hence, the rate of VAT on the vacuum cleaner is 15%
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