Question

Rahul went to purchase a Nokia mobile handset, the shopkeeper told him to pay 20% tax if he asked for the bill. Rahul manages to get the discount of 5% on the actual selling price of the mobile and he paid the shopkeeper Rs. 3325 without tax. Besides he manages to avoid to pay 20% tax on the already discounted price, what is the amount of discount that he got?

1. Rs. 650
2. Rs. 775
3. Rs. 875
4. Rs. 720
5. Rs. 850

Answer 1

Correct Answer - Option 3 : Rs. 875

Given:

Tax to be paid if he asked for the bill = 20%

Discount on actual selling price of the mobile = 5%

Amount paid by Rahul to the shopkeeper without tax = Rs. 3325

Rahul manages to avoid to pay tax on the already discounted price = 20%

Calculation:

Let CP be 100

Then, SP with tax = 120

New SP = 100 – 5 = 95

Effective discount = SP with tax – New SP

Effective discount = 120 – 95 = 25

⇒ At SP of 95 discount = 25

Then, at SP of 3325 discount = 3325 × (25/95) = 875

∴ Amount of discount he got = Rs. 875