WITHHOLDING TAX AND SALES TAX

[Dagabie]

What are the sales and withholding tax amounts on the following transactions?

A taxable trader sold 100ctns of goods tax inclusive at $30 per carton to a customer.

Discount allowed for prompt payment 2%.

Sales tax 17.5%.

Withholding tax 5%.

[Dagabie]

WITHHOLDING TAX AND SALES TAX


Answer:

Sales 100ctns @ $30 = $3000

Less sales tax 17.5%/117.5% x $3000 = $447

Net sales ($3000 - $447) = $2553

Less withholding tax (by customer) 5% x $2553 = $128