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| Math Central | Quandaries & Queries |
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Question from Chris: Dear Math Central, I've been looking at a few answers to the question of before and after GST price calculation. But how do you calculate the pre GST price from an existing retail price? For example if you take an item that is $150.00 and multiply it by 0.10 you get $15.00 as the GST add on. Apparently giving you $135.00 as the pre GST price. However if you then multiply $135.00 by 1.10 you get the $148.50 as the total. So the question is how does one calculate the real pre GST price from an existing retail price? Regards, Chris |
Chris,
If the GST rate is 10% and the pre GST price is say $120.00 then the GST is 0.10 × $120.00 = $12.00 and the price including the GST is $120.00 + $12.00 = $132.00. To do this in one step, the price including the GST is 1.10 × $120 = $132.00.
If you know the price including the GST is $132.00 then to find the per GST price you divide by 1.10.
$132.00/1.10 = $120.00
I hope this helps,
Penny
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