Value Added Tax (VAT) is an indirect tax equal to 12% of the price of a good or commodity. The document provides examples of calculating VAT on actual prices, finding the VAT amount when given the selling price, and calculating the actual price when given the VAT amount and selling price. All calculations involve multiplying the actual price by 12% to get the VAT and adding the VAT to the actual price to get the selling price.

1. Calculating VAT

2. Value Added Tax (VAT) – a form of indirect
tax on a good or commodity. It may
or may not be charged to the
consumer.
– set at 12% of the price of the
good or commodity.

3. Example: Actual Price: ₱4,500
VAT: ?
Selling Price: ?
To get the VAT:
₱4,500 × 0.12 = ₱540.00
To get the Selling Price:
₱4,500 + ₱540.00 = ₱5,040.00
VAT: ₱540.00 Selling price: ₱5,040.00

4. Try:
Actual Price: ₱1,956.00
VAT: ? Selling Price: ?
Solution:
₱1,956.00 × 0.12 = ₱234.72
₱1,956.00 + ₱234.72 = ₱2,190.72
VAT: ₱234.72
Selling Price: ₱2,190.72

5. Example:
Actual Price: ?
VAT: ₱1,092.72
Selling Price: ₱10,198.72
To get the Actual Price,
₱10,198.72 ̶ ₱1,092.72 = ₱9,106.00
Actual Price: ₱9,106.00

6. Try:
Actual Price: ?
VAT: ₱1,506.00
Selling Price: ₱14,006.00
Solution:
₱14,006.00 ̶ ₱1,506.00 = ₱12,500.00
Actual Price: ₱12,500.00

7. Example:
Actual Price: ₱4,670.00
VAT: ?
Selling Price: ₱5,230.40
To find VAT,
₱4,670.00 × 0.12 = ₱560.40
VAT: ₱560.40

8. Try:
Actual Price: ₱9,630.00
VAT: ?
Selling Price: ₱10,785.60
Solution:
₱9,630.00 × 0.12 = ₱1,155.60
VAT: ₱1,155.60