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Value-added tax (VAT)

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XZ sells two types of product, A and B. A is standard rated for VAT purposes and B is zero rated. All purchases have incurred VAT at standard rate.

XZ's sales (inclusive of VAT where applicable) for the three months to 31 March 2012 were:

$
A 63,250
B 24,150
Total 87,400

XZ's purchases for the three months to 31 March 2012 were $32,333 exclusive of VAT.

Calculate the amount of VAT that XZ is due to pay for the three months to 31 March 2012.

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Solution Summary

The amount of VAT payable is calculated as the difference between the output tax collected and input tax incurred in a sample question

Solution Preview

In the VAT settlement, we deduct input VAT from output VAT. The resulting ...

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