How to calculate percentage

[evedawn]

I do I work out the nett price of something? in other words what is the CALCULATION to deduct 20% (VAT) to get the nett

For example: Gross £27.90

[factor-fiction]

Divide by 1.2

[scrunge999]

27.90 = 1.2 x nett
=> nett = 27.90 / 1.2
= 23.25

[sir.prize]

That's interesting. Can someone explain to me why this does not work?

10% of £27.90 = £2.79
So 20% = £5.58

£27.90 minus £5.58 = £22.32

[Buenchico]

Sir.Prize:
The VAT which was added on was 20% of the original price, not of the VAT-inclusive price (which is what you're calculating).

[heathfield]

Looking at it this in a simpleton's way, (i.e., the way I do it!)...

Call the net price 100%. With 20% VAT added, the gross price becomes 120%. Divide the gross price by 120 to get 1%. Then multiply the 1% by 100 to get the net price of 100%.

It just gives the same result as do the previous answers.

[scotman]

It doesn't work because it is not the same calculation.

[evedawn]

thank you! My maths is just terrible

[heathfield]

(Except for Sir-Prize's incorrect solution!).

[sir.prize]

Thank you all for the quick responses and calulations. Maffs is not my best subject. Bring back old purchase tax.

[DavideMexia]

sir prize. That doesnt work because
100/1.2=83.3333£

Obviously if you do 83.33(3)£*1.2=100£
if you as stated
100*0.2=20
80*1.2=96

using the same thinking in yout example:
If you do 27.90£*0.2=5.58£
22.32*1.2=26.784 which is not equal to 27.90

In your example given if you calculate that way it wont give you the Net figure

You should divide the figure with vat included (27.90) with 1.2 to calcualte the Net Figure.

Hope this helps

[sir.prize]

Davide - yes that really helps. Thank you.

Wish I hadn't asked though!!! Have a ncie day everyone.

[DavideMexia]

sir prize:

In accounting purposes for a simple purchase:
Purchase account DR 23.25£
Vat Account DR 4.65£
Trade Creditors CR 27.90£

[heathfield]

I think that Scotman must be referring to Sir-Prize's calculation, and not to mine !!