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Anonymous bio_man
wrote...
A week ago
Lisa's Home Income Tax business operates only during tax season. This year Lisa grossed $32,578 including GST. She also spent $5891 before GST on her paper and supply purchases. If Lisa is voluntarily registered for GST, how much does she owe the Canada Revenue Agency for GST?
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bio_man Authorbio_man
wrote...
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Posts: 31421
A week ago Edited: A week ago, bio_man
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First, find out the gross before the person added 5% GST:

x + x(0.05) = $32,578

1.05x = 32,578 / 1.05

x = $31,026.67

This is how much Lisa sold without having charged tax to her customers.

Next, calculate the amount of tax owed on the earned income of $31,026.67.

$31,026.67 * 0.05 = $1,551.33 (... or simply $32,578 - $31,026.67)

The expenditures are $5,891. Remember, the person payed tax on these expenses, so:

5891 * 0.05 = $294.55

Lastly, $1,551.33 - $294.55 = $1256.78
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Anonymous Author
wrote...

A week ago
Smart ... Thanks!
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Yesterday
Good timing, thanks!
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2 hours ago
this is exactly what I needed
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