Calculate the VAT and cost of sales for the following business transactions.

The purchase amount is R38 525 (VAT inclusive).

• Cost of inventory (VAT exclusive): $$\frac{\text{R}38\,525}{1 + 0.15} = \frac{\text{R}38\,525}{1.15} = \text{R}33\,500$$
• Input VAT: $$\text{R}38\,525 - \text{R}33\,500 = \text{R}5\,025$$
• Total amount payable to Tiny Wholesalers: R38 525

The return amount is R31 510 (VAT inclusive).

• Reduction in inventory cost (VAT exclusive): $$\frac{\text{R}31\,510}{1 + 0.15} = \frac{\text{R}31\,510}{1.15} = \text{R}27\,400$$
• Reduction in Input VAT: $$\text{R}31\,510 - \text{R}27\,400 = \text{R}4\,110$$
• Bank refund received: R31 510

The sales amount is R19 596 (VAT inclusive).

• Sales revenue (VAT exclusive): $$\frac{\text{R}19\,596}{1 + 0.15} = \frac{\text{R}19\,596}{1.15} = \text{R}17\,040$$
• Output VAT: $$\text{R}19\,596 - \text{R}17\,040 = \text{R}2\,556$$
• Cost of sales (using mark-up on cost of $20\%$): $$\frac{\text{Sales revenue}}{1 + \text{Mark-up percentage}} = \frac{\text{R}17\,040}{1 + 0.20} = \frac{\text{R}17\,040}{1.20} = \text{R}14\,200$$
• Total amount receivable from Winny Stores: R19 596

The sales amount is R10 488 (VAT inclusive).

• Sales revenue (VAT exclusive): $$\frac{\text{R}10\,488}{1 + 0.15} = \frac{\text{R}10\,488}{1.15} = \text{R}9\,120$$
• Output VAT: $$\text{R}10\,488 - \text{R}9\,120 = \text{R}1\,368$$
• Cost of sales (using mark-up on cost of $20\%$): $$\frac{\text{Sales revenue}}{1 + \text{Mark-up percentage}} = \frac{\text{R}9\,120}{1 + 0.20} = \frac{\text{R}9\,120}{1.20} = \text{R}7\,600$$
• Total cash received from Mr Money: R10 488

The purchase amount is R25 990 (VAT inclusive).

• Cost of inventory (VAT exclusive): $$\frac{\text{R}25\,990}{1 + 0.15} = \frac{\text{R}25\,990}{1.15} = \text{R}22\,600$$
• Input VAT: $$\text{R}25\,990 - \text{R}22\,600 = \text{R}3\,390$$
• Total cash paid to Sparky Wholesalers: R25 990

The sales return amount is R11 340 (VAT exclusive).

• Output VAT reversal: $$\text{R}11\,340 \times 0.15 = \text{R}1\,701$$
• Total amount to be credited to Mitty Stores: $$\text{R}11\,340 + \text{R}1\,701 = \text{R}13\,041$$
• Cost of goods returned (using mark-up on cost of $20\%$): $$\frac{\text{Sales return amount}}{1 + \text{Mark-up percentage}} = \frac{\text{R}11\,340}{1 + 0.20} = \frac{\text{R}11\,340}{1.20} = \text{R}9\,450$$
• Total credit note issued to Mitty Stores: R13 041

The equipment cost is R42 800 (VAT exclusive).

• Input VAT: $$\text{R}42\,800 \times 0.15 = \text{R}6\,420$$
• Total amount payable to Lightning Traders: $$\text{R}42\,800 + \text{R}6\,420 = \text{R}49\,220$$
• Cost of equipment: R42 800