 Hello and welcome to the session. In this session we will discuss the following question and the question says, A purchases an article for $360 and sells it to B for $480. B in turn sells the article to C for $550. If the VAT rate is 10%, find the VAT levied on A and V. Before we start solving the question, let us first recall the definition of VAT. VAT is value added tax. That is, it is a tax on the value added at each transfer of goods from original manufacturer to the ultimate customer. This is the key idea for this question and using this key idea, we will solve the question. Let's start the solution now. We are given that A purchases an article for $360. So, cost price for A is equal to $360. Also, A sells it to B for $480. So, selling price is equal to $480. We will now calculate the value added. So therefore, value added is equal to selling price for A, which is $480 minus cost price for A, which is $360. This is equal to $120. We have to find the VAT levied on A and B. First, we will find it for A. It is given that VAT rate is 10%. So, VAT levied on A is equal to 10% of the value added, which is $120. This is equal to 10 upon 100 into $120. Zeroes get cancelled. So, this implies VAT levied on A is equal to $12. We will now calculate the VAT levied on B. Since it is given that A sells the article to B for $480. So, cost price for B is equal to $480. Also, it is given that B in turn sells the article to C for $550. So, selling price for B is equal to $550. Therefore, value added is equal to selling price for B, that is $550 minus cost price for B, which is $480 and this is equal to $70. So, the VAT levied on A is equal to 10% of the value added, which is $70. This is equal to 10 upon 100 into $70. Zeroes get cancelled and this is equal to $7. So, the final answer is VAT levied on A is equal to $12 and VAT levied on B is equal to $7. This is the end our session. Hope you enjoyed the session.