12.05.24 Sales tax, tip, discount, markup

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What is sales tax?

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A sales tax is a percentage of the sale price that is added to the cost of goods and services, collected by the seller and paid to the government.

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How do you calculate sales tax?

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To calculate sales tax, multiply the price of the item by the sales tax rate (as a decimal). For example, for a $100 item with a 5% tax rate: $100 x 0.05 = $5.

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What is a discount?

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A discount is a reduction in the original price of a product or service, often expressed as a percentage.

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How do you calculate the amount saved from a discount?

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To calculate the amount saved from a discount, multiply the original price by the discount rate (as a decimal). For example, a 20% discount on a $50 item saves $10.

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What is a markup?

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A markup is an increase in the price of a product or service, usually expressed as a percentage of the cost.

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How do you calculate the selling price after markup?

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To calculate the selling price after markup, add the markup amount to the original cost. For example, if an item costs $20 and has a 25% markup, the selling price is $20 + ($20 x 0.25) = $25.

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What does it mean when a price is marked down?

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A marked down price indicates that the price has been reduced from its original price, often to encourage sales.

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If an item costs $200 and is marked down by 15%, what is the sale price?

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The sale price is $200 - ($200 x 0.15) = $170.

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What is the formula for calculating total cost including sales tax?

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Total cost = Original price + (Original price x Sales tax rate). For example, for a $100 item with a 6% tax: Total cost = $100 + ($100 x 0.06) = $106.

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How do you find the total price after applying a discount and then adding sales tax?

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First, calculate the discounted price, then apply the sales tax to that price. For example, for a $100 item with a 20% discount and 5% tax: Discounted price = $100 - ($100 x 0.20) = $80; Total price = $80 + ($80 x 0.05) = $84.