Sales Tax

In this lesson we will learn how to solve math problems involving sales tax.



Remember these two important formulas:

Final price = price before tax + sales tax

Sales tax = sales tax rate x price before tax

Example 1:

Donna wants to buy a dress that has a price tag of $85.00. If the sales tax rate is 8%, how much does she have to pay for the dress?

Adela wants to buy a dress that has a price tag of $85.00. If the sales tax rate is 8%, how much does she have to pay for the dress?

Solution

The sales tax = 8% of the price tag = 8% x $85.00 = 0.08 x 85.00 = $6.80

The final price = price before tax + sales tax = $85.00 + $6.80 = $91.80

Example 2:

If the price of a CD player before tax is $70, and the price after tax is $74.20, find the sales tax rate.

Solution:

The sales tax = Final price - price before tax = $74.20 - $70.00 = $4.20

Sales tax = sales tax rate x price before tax

$4.20 = sales tax rate x $70

The sales tax rate = 4.20 / 70 = 0.06 = 6%

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