Discount, Tax, And Tip Word Problems

Introduction

Discount, taxes, and tip are common concepts encountered in financial transactions, especially in the context of purchasing goods or services. Here’s a brief explanation of each:

Discount

A discount is a reduction in the price of an item or service. It is often expressed as a percentage of the original price. Discounts can be offered for various reasons, such as promotional sales, loyalty programs, or bulk purchases. For example, if an item originally costs $100 and there’s a 20% discount, the discounted price would be $80.

Tax

Tax is an additional amount of money imposed by the government on goods and services, typically calculated as a percentage of the purchase price. The tax rate varies depending on the jurisdiction and the type of goods or services being purchased. Sales tax is a common form of tax applied to retail purchases. For example, if a product costs $50 and the sales tax rate is 10%, the total cost including tax would be $55.

Tip

A tip, also known as a gratuity, is an extra amount of money given voluntarily to someone who provides a service, such as a waiter in a restaurant or a taxi driver. Tips are usually calculated as a percentage of the total bill. The customary tip rate can vary depending on cultural norms and the quality of service received. For example, if a restaurant bill totals $80 and the customary tip rate is 15%, the tip would be $12.

Example Questions 

1. Problem on Discount:

A store is offering a 20% discount on all its items. If a dress originally costs $50, how much will it cost after the discount?

Solution

Given that the dress originally costs $50 and there’s a 20% discount, we can find the discounted price by multiplying the original price by the fraction representing the discount (1 – 0.20 = 0.80):

Discounted price = $50 x 0.8 = $40

So, the dress will cost $40 after the discount.

2. Problem on Tax:

If a laptop costs $1000 and the sales tax rate is 8%, how much will you pay in total including tax?

Solution

To find the total cost including tax, we need to add the original cost to the tax amount. The tax amount can be calculated by multiplying the original cost by the tax rate (0.08):

 Tax = $1000 x 0.08 = $80

Adding this tax amount to the original cost gives the total cost:

Total cost = $1000 + $80 = $1080

So, you will pay $1080 in total including tax.

3) Problem on Tip:

If you had a meal at a restaurant that costs $40 and you wanted to leave a 15% tip, how much tip would you leave?

Solution:

To find the tip amount, we multiply the original cost of the meal by the tip percentage (0.15):

Tip = $40 x 0.15 = $6

So, you will leave a $6 tip.

4. Problem on Discount and Tax:

A pair of shoes originally cost $80, but there’s a 10% discount on them. If the sales tax rate is 7% on the discounted price, how much will you pay in total, including tax, after the discount?

Solution:

First, we find the discounted price of the shoes:

Discounted Price = $80 x 0.90 = $72

Then, we calculate the tax amount on the discounted price:

Tax = $72 x 0.07 = $5.04

Finally, we add the discounted price and the tax amount to find the total cost:

Total Cost = $72 + $5.04 = $77.04

So, you will pay $77.04 in total, including tax, after the discount.

Discount, Tax, And Tip FAQS

Grade 7 Science Worksheets

• Elements and Compounds
• Solar Energy
• Photosynthesis
• Electricity and Magnetism
• Law of conservation of energy
• Periodic table
• Properties of Matter
• Waves
• Energy Resources 
• Weather and Climate
• Immune, Circulatory and Digestive Systems
• Organs in Multi-cellular Organism
• Sedimentary, Igneous, and Metamorphic Rocks
• Structure of the Earth
• Law of Conservation of Mass
• Physical and Chemical Changes
• Scientific Method
• Human Digestive System
• Environmental Science
• Renewable and Non-renewable energy Resources
• Characteristics of Living Organisms
• Life Science
• Earth and Space Science
• Solar Eclipse
• Heat Technology
• Newton’s Laws of Motions
• Physical Science
• Tools, Measurement and SI Units
• Earth Atmosphere
• Interactions of Living things
• The Earth Ecosystem
• Organelles in Plant and Animal cells
• Layers of the Earth
• Cycles in Nature

Grade 7 Math Worksheets

• Fractions
• Linear equations word problems
• Statistics
• Properties of Parallel Line
• Finding slope from an equation
• Identifying Quadrilaterals
• Percent Change
• Properties of addition and multiplication
• Pythagorean Theorem
• Solving two step inequalities
• Symmetry
• Fractions to Decimals (New)
• Whole Number Exponents with Integer Bases (New)
• Adding and Subtracting Fractions (New)
• Integer Addition and Subtraction (New)
• Dividing Mixed Numbers (New)
• Basics of Coordinate Geometry (New)