Fine weight, wastage and the two-column khata, explained

Every jeweller knows this maths. Most of them learned it at a counter, not from a page, and most of them have also watched a customer, a karigar or a new staff member get it slightly wrong. This is the whole thing written down: fine weight, wastage, making charges, old gold, GST, and the two-column book that keeps metal and money apart.

We wrote it while building Gulabi Bahi, our billing and khata software for jewellers, so the examples below are the ones its maths is tested against.

Gross, net and fine

Gross weight is what the piece weighs on the scale.

Net weight is the metal alone. A kundan or lac piece weighs more than the gold in it, so the stones, lac and threads come off before anything else is worked out.

Fine weight is the pure metal in that net weight, plus whatever wastage the trade adds. Fine weight is what a karigar owes back, what a supplier counts, and what the metal column of the khata is kept in.

Purity, in all its spellings

The same purity goes by several names:

• 22K is 916, which means 91.6% pure gold.
• 18K is 750, or 75%.
• 925 is sterling silver, 92.5%.
• Tunch is the purity a piece actually tested at, written as a percentage, like “tunch 93”.

Wastage

Wastage is the extra metal added for what’s lost in making: filing, polishing, solder. It’s written as a percentage and added to the purity, not multiplied with it.

So the formula is:

Fine weight = Gross (or net) weight × (Purity + Wastage) %

A worked example

A karigar returns work weighing 127.860 g, at 93% tunch, with 5% wastage agreed.

127.860 × (93 + 5)% = 127.860 × 0.98 = 125.3028 g

Written to three decimals, that’s 125.302 g, not 125.303.

Why the trade cuts instead of rounding

The fourth decimal is dropped, never rounded up. A milligram either way sounds like nothing. But it’s added on every line of every bill, all year, and rounding up always favours whoever is owed metal. Cutting at three decimals is the custom precisely because it doesn’t favour anyone, and it means two people working out the same bill by hand get the same answer.

Making charges

Making charges are billed in money, and there are three common ways to set them:

• Per gram, for example ₹600 a gram of net weight;
• A percentage of the metal’s value, common for machine-made pieces;
• Per piece, for small items where weight hardly matters.

Many shops also keep a minimum, so a very light piece still carries a sensible charge.

Old gold, set against the bill

When a customer brings old gold, three things decide what it’s worth:

1. its gross weight;
2. its tested purity, from the touchstone or the machine;
3. melting loss, the metal that won’t survive being melted down.

Gross × (tested purity − melting loss)% gives the fine metal it’s worth. That fine metal (or its value at the day’s rate) is then set against the bill after tax, so the GST on the new piece is still worked out on the full sale.

GST, briefly

Gold, silver and jewellery are taxed at 3%. Job work, where a karigar works on metal that isn’t theirs, is billed at 5% on the labour. Inside your own state the tax splits into CGST and SGST; for a customer in another state it’s IGST. Rates change from time to time, so check with your CA, who is paid to know this better than we are.

Two columns, one book

This is where diaries and general accounting software struggle. A jeweller’s customer, supplier or karigar doesn’t owe you one thing. They owe you two: grams of fine metal, and rupees.

A customer buys a necklace. They pay for the metal by handing over old gold, and pay the making and GST in cash. Until both are settled, their account shows two balances, side by side, and neither can be added to the other.

Try it: hand over some old gold and some cash, and watch both columns close.

Payments can come in any form: cash, UPI, cheque, or metal itself, valued at an agreed rate. Each one moves the right column. A karigar’s account works the same way in reverse: you hand over fine metal, they return finished work worth a certain fine weight, and the labour is billed in rupees.

If you’d rather not do this by hand

Gulabi Bahi keeps both columns for every party, works out fine weight on every line with the trade’s three-decimal cut, and prints GST invoices or estimates. Bahi, for one counter, is ₹7,999 a year; Dukaan, for the whole shop, is ₹11,999 a year, plus GST, and the first 30 days are free.

The quickest way to judge it is to make a bill yourself. The demo shop is open at try.gulabibahi.com, with a made-up shop already in it, and nothing you type there leaves your browser.