Please help me with this question
why the answer is c 626 ?
Lira sells goods worth $18700 and buys goods for $14500. Both transactions include Sales tax at 17.5% on the listed price. Calculate how much does Lira has to pay the tax authorities in respect of these two transactions?
a $2785
b $2159
c $626
d $4944
ACCA Forums
FAGeneral principles of sales tax
7y ago#1If you want me to answer, then in future ask in the Ask the Tutor Forum. This forum is for students to help each other.
Both amounts are including sales tax.
Therefore the tax payable;e to the tax authorities is 17.5/117.5 x (18,700 - 14,500) = 626
The rules are all explained in my free lectures on sales tax. The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.
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