Forum Discussion
Formula for finilazing resale value of product and to know the profit after Tax dues
Hello,
Can someone please help me with the below detailed issue; I need a formula for this calculation.
I am a re-seller and I purchase from the Distributor. The MRP (Maximum Retail Price) is printed on the boxes and the MRP is inclusive of 18% tax. Suppose the MRP is Rs. 10000
The Distributor sells it to the re-seller at Dealers Price and not at MRP and the re-seller further sells it to his customer at MRP rate.
I pay tax to the Government by claiming input credit, that is, the tax paid to the distributor when I bought the product from him for onward sell.
Example:
MRP printed on the on the product is – Rs. 1000
Dealer sells it to me for - Rs. 800
I sell it to my customer with 10% discount on MRP, that is, for Rs. 900
The unseen breakup of rates:
a) Product cost Rs. 847.457 + Tax @ 18% Rs = 152.542 (Roundup Rs. 1000)
b) Dealer Price Rs. 677.966 + Tax @18% Rs = 122.033 (Roundup Rs. 800)
c) Sold at Rs. Rs. 762.711 + Tax @ 185 = 137.288 ( (roundup Rs. 900)
Tax due to the Government from me:
Tax Charged to customer by re seller Rs. 137.288
Tax already paid through the distributor Rs. 122.033
Tax Due to pay 137-122= Rs. 15
How we arrive at profit :
Collected from resale = Rs. 900
Paid to Distributor = Rs. 800
Balance Tax Due to Government Rs. 15
Total Cost to me = (Rs. 800+Rs. 15)
Profit in the above sell is : (9.44%) Rs.85 (Rs.900-Rs. 800-Rs.15=Rs 85)
In view of above, I am seeking help to do a formula, which may be like this;
I should be able to choose option to give discount on MRP and then I should know how much profit I will earn on the product. or any other format to know my profit while fixing a price for resale.
Ronald1969 Had seen your question pop-up in another unrelated thread yesterday. Thanks for re-posting it in a new one. The attached workbook may have the formulae you are asking for. I kept your example on the side, so that it was easier to compare your request with the outcome of the formulae.
6 Replies
- Riny_van_EekelenPlatinum Contributor
Ronald1969 Had seen your question pop-up in another unrelated thread yesterday. Thanks for re-posting it in a new one. The attached workbook may have the formulae you are asking for. I kept your example on the side, so that it was easier to compare your request with the outcome of the formulae.
- Ronald1969Brass ContributorThanks for your help. In fact, I am feeling very happy to use Excel. Earlier I was not aware that such dynamic personalities like you are always available to help people like me. You have assisted me even earlier. Thank you.
- Riny_van_EekelenPlatinum Contributor
Ronald1969 You are most welcome!