Part of: Miscellaneous Indian Gk set 314

The tax invoice of a telecom service in Manipur shows cost of services provided by it as Rs. 750. If the GST rate is 18%, find the amount of bill.

Category: Miscellaneous Indian Gk

Hint: Calculate the total bill amount by adding the GST to the base cost.

Correct Answer: A) Rs. 885.

Exam Relevance: UPSC, SSC, Bank PO

Difficulty: Easy

Explanations:

The Goods and Services Tax (GST) is a comprehensive indirect tax levied on the supply of goods and services in India. It is a single tax on the supply of goods and services, right from the manufacturer to the consumer. The tax is levied at each stage of the supply chain, with the tax paid to the government being the difference between the GST charged on the supply of goods or services and the GST paid on the purchase of goods or services used in making the supply.

In this problem, we are given the cost of services provided by a telecom service in Manipur as Rs. 750, and the GST rate is 18%. To find the total bill amount, we need to calculate the GST and add it to the base cost.

The formula to calculate the total bill amount with GST is:

Total Bill Amount = Base Cost + (Base Cost × GST Rate)

Substituting the given values:

Total Bill Amount = Rs. 750 + (Rs. 750 × 18%)

First, we calculate the GST amount:

18% of Rs. 750 = 0.18 × 750 = Rs. 135

Now, we add the GST amount to the base cost:

Total Bill Amount = Rs. 750 + Rs. 135 = Rs. 885

Therefore, the total bill amount is Rs. 885, which corresponds to Option A.

It is important to understand that the GST is an additional tax on the base cost, and the final consumer bears the entire tax. The calculation involves multiplying the base cost by the GST rate and then adding the result to the base cost to get the total bill amount.

Option Analysis:
  • Option A: This is the correct answer. The total bill amount is calculated by adding 18% GST to the base cost of Rs. 750, resulting in Rs. 885.
  • Option B: This is incorrect. Rs. 750 is the base cost of the service before GST is added, not the total bill amount.
  • Option C: This is incorrect. Rs. 855 is not the correct total bill amount after adding 18% GST to Rs. 750.
  • Option D: This is incorrect. Rs. 850 is not the correct total bill amount after adding 18% GST to Rs. 750.

Mnemonic: GST = Goods and Services Tax

Back to Miscellaneous Indian Gk set 314 – Practice all questions