SALES TAX DISCOUNT AND TIP

Sales tax is a percent of an item’s cost. Sales tax and tips are sometimes estimated instead of calculated exactly.

Discount is the amount reduced from the original price of an item. 

A tip is an amount of money added to a bill for service. It is usually a percent of the bill before sales tax is added.

Example 1 : 

Find a 12% tip on a check for $40.  

Solution : 

=  12% of 40

Convert the percent to decimal. 

=  0.12 ⋅ 40

Multiply 0.15 and 70.

=  4.8

The tip is $4.80. 

Example 2 : 

Estimate the tax on shoes that cost $68.50 when the sales tax rate is 8.25%

Solution : 

First round $68.50 to $70 and 8.5% to 8%.

8% of 70  =  (8%)(70)

Convert the percent to decimal. 

=  0.08 ⋅ 70

=  5.60

The sales tax is about $6.

Example 3 : 

The dinner check for Mr. David’s family is $70. If a tip of 15% is paid, How much total money should Mr. David pay ?  

Solution : 

Total amount of money :

=  Bill for Food + Tip

=  70 + 15% of 70

Convert the percent to decimal. 

=  70 + 0.15 ⋅ 70

Multiply 0.15 and 70.

=  70 + 10.5

=  80.5

Mr. David should pay $80.50.

Example 4 : 

If the sales tax rate is 6%, find price of the shirt after sales tax on a shirt that costs $30.

Solution : 

Price after sales tax :

=  Original price + Sales tax

=  30 + 6% of 30

Convert the percent to decimal. 

=  30 + 0.06 ⋅ 30

Multiply 0.06 and 30.

=  30 + 1.8

=  31.8

The price after the sales tax is $31.80.

Example 5 : 

In a department store, a $50 dress is marked, "Save 25%." What is the discount? What is the sale price of the dress?

Solution : 

Discount : 

=  25% of 50

=  (25%)(50)

Convert the percent to a decimal. 

=  0.25 ⋅ 50

Multiply 0.25 and 50.

=  12.50

The discount is $12.50.

Sale price of the dress can be found by subtracting the discount from the marked price. 

Price after after discount :

=  Marked price - Discount

=  50 - 12.5

=  37.50

The sale price of the dress is $37.50.

Example 6 : 

In a store, a $20 dress is labelled "25% off". If the sales tax rate is 5%, what is the final price of the dress ? 

Solution : 

Discount :

=  25% of 20

=  (25%)(20)

Convert the percent to a decimal. 

=  0.25 ⋅ 20

Multiply 0.25 and 20.

=  5

The discount is $5.

Price after after discount :

=  Marked price - Discount

=  20 - 5

=  15

The sale price is $15.

Price after after sales tax :

=  Sale price + Sales tax

=  15 + 5% of 15

=  15 + 0.05 ⋅ 15

=  15 + 0.75

=  15.75

The final price of the dress is $15.75.

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