Tax Free Items | MCQs

Explanation

Total cost of items = Rs. 25

Tax amount = 30 paise = Rs. 0.30

Tax rate = 6%

Let's find the cost of the taxable items:

Tax amount = 6% of taxable items

0.30 = (6/100) × taxable items

Taxable items = 0.30 × (100/6) = Rs. 5

Now, let's find the cost of the tax-free items:

Cost of tax-free items = Total cost - Taxable items - Tax amount

= 25 - 5 - 0.30

= Rs. 19.70