Discounts Markups and Taxes Mrs Leuschens 3 rd

Discounts, Markups, and Taxes Mrs. Leuschen’s 3 rd Period Math

Learning Targets I can find the discount using the percent equation I can find the new cost of a discounted item I can find the markup cost using the percent equation I can find the new cost of an item that has been marked up. I can find the taxes of an item I can find the total cost of an item that has been taxed.

Discount Very few people want to spend full price on items. So, when we can save some money, Hooray!!!

Discount This is what happens when you have a discount

Discount How do you find the amount that you save? Take the original amount x the percent (in decimal form)

Discount How do you change a percent to a decimal? Change Percent to a Decimal to a Fraction

Discount So, back to our original equation, $50 x 50% or 0. 5 as we just learned, will give us the amount that is discounted. The answer is $25

Discount Let’s try a couple of our own: 25% off $800 watch 30% off $50 earrings

Discount Please note: The discounted amount is NOT the amount that is left over. It is the amount that we SUBTRACT from the original amount: Original amount x percent discounted = discount Then… Original amount – discount = new price (amount)

Markup Sample:

Markup Rate Definition of markup rate

Markup Rate For discount, we subtracted. For markup, we add to the original price. Think about these examples:

Markup An owner buys a t-shirts for $3. He puts his own logo on the shirts and marks up the cost $72%. How much of a mark up is there? What is the new cost? $3 x 72% or $3 x 0. 72 = the markup cost The markup cost + the original cost = New selling price

Outrageous Markups Take a look at what these markups are in real life: 20 Outrageous Markups

Markup and Discount Practice Now, you try: Binders: Cost $0. 35, Markup 55% Mascara: Cost $7. 25, Discount 5% Pen: Cost $3. 50, Discount 1% Find the markup or discount price, THEN, add or subtract from the original price

Taxes Have you heard these sayings?

Taxes But, there’s more!

Taxes In order for the government can have an army, build freeways, create schools, provide electricity, energy and water, to function, we have to pay taxes. Julius Levinson: "You don't actually think they spend $20, 000 on a hammer, $30, 000 on a toilet seat, do you? Independence Day

Taxes vary from state to state, even county by county Taxes are an additional cost to an item, that is not food!

Taxes Things that are taxed… Not Taxed

Taxes Item x tax (%) Example: Ring $72, 000 x 6% tax = Amount of the tax

Taxes You will need to ADD the tax amount to the original cost to find the total price: $72, 000 + the tax amount = selling price

Taxes Try all three Find the discount price: $850 x 10% discount Find the new selling price: Find the markup price: $850 x 10% markup Find the new selling price: Find the tax: $850 x 8. 5% Find the new selling price:

Combination: Discount and Tax In real life, we will save money by finding the best discount. Unfortunately, we still have to pay taxes on it. This results in a multi-step equation.

Combination Amy buys a shirt that was originally $80 but is discounted 25%. She will still need to pay the taxes on the shirt, which is 8. 5%. What is the cost of the shirt? Step one: Find the discounted price – Original cost x % of discount Step two: Subtract the original cost from the discounted price to find the sale price Step three: Find the tax amount: Sale price x % tax to find the taxable amount Step Four: Add the sale price to the taxable amount. The same is true for markup – just ADD instead of SUBTRACT for the discount.

Learning Targets – Can You…