Mark-ups, Tax, and Tips

Front

What is a gratuity?

Back

A gratuity, commonly known as a tip, is a sum of money given to service workers for their service, typically calculated as a percentage of the total bill.

Front

How do you calculate gratuity?

Back

To calculate gratuity, multiply the total bill amount by the gratuity percentage (expressed as a decimal). For example, for an 18% gratuity on a $75.45 bill: $75.45 x 0.18 = $13.58.

Front

What is a mark-up?

Back

A mark-up is the amount added to the cost price of goods to cover overhead and profit. It is usually expressed as a percentage of the cost price.

Front

How do you calculate the mark-up percentage?

Back

To calculate the mark-up percentage, subtract the cost price from the selling price, divide by the cost price, and multiply by 100. Formula: ((Selling Price - Cost Price) / Cost Price) x 100.

Front

If a store buys a computer for $675 and sells it for $1012.50, what is the mark-up percentage?

Back

The mark-up percentage is 167%. Calculation: ((1012.50 - 675) / 675) x 100 = 167%.

Front

What is sales tax?

Back

Sales tax is a tax imposed by the government on the sale of goods and services, usually calculated as a percentage of the purchase price.

Front

How do you calculate sales tax?

Back

To calculate sales tax, multiply the purchase price by the sales tax rate (expressed as a decimal). For example, for a $3.50 item with a 5% tax: $3.50 x 0.05 = $0.175.

Front

If Vicky's total purchases are $15.70 and the sales tax is 5%, what is the total amount she will pay?

Back

The total amount Vicky will pay is $16.49. Calculation: $15.70 + ($15.70 x 0.05) = $16.49.

Front

What is the formula to find the total cost including tax?

Back

Total Cost = Purchase Price + (Purchase Price x Sales Tax Rate).

Front

How much tax would you pay on a $899 TV with a tax rate of 6.5%?

Back

The tax paid would be $58.43. Calculation: $899 x 0.065 = $58.43.