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In Germany, VAT is at 19% Jeremy buys a calculator in Germany for UND58.31 This price includes VAT. Find the amount of VAT paid by Jeremy.

Question

In Germany, VAT is at 19% 
Jeremy buys a calculator in Germany for UND58.31
This price includes VAT.
Find the amount of VAT paid by Jeremy.

In Germany, VAT is at 19% Jeremy buys a calculator in Germany for UND58.31 This price includes VAT. Find the amount of VAT paid by Jeremy.

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PercyProfessional · Tutor for 6 years

Answer

<p> The calculation will be as follows: Pre-tax price = 58.31/(1+19/100) ≈ € 48.99. The VAT amount is then obtained by subtracting the pre-tax price from the total price, i.e., € 58.31 - € 48.99 = € 9.32. Hence, Jeremy paid € 9.32 as VAT.

Explain

<p> In order to find the amount of VAT paid, we first need to determine the original price of the product before the VAT was included (this is the pre-tax price). Given that the price paid by Jeremy, which includes VAT, is € 58.31, and knowing that in Germany the VAT rate is 19%, we can find the pre-tax price by using the formula "pre-tax price = total price/(1+VAT rate)". Plugging in the values gives "pre-tax price = 58.31/(1 + 0.19)". To find the VAT amount, we subtract this pre-tax price from the total price.</p>
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