Which of the following best describes the process for determining the sales tax and total purchase price of an item?
A
Divide the item's price by the sales tax rate to find the sales tax, then subtract it from the item's price to get the total purchase price.
B
Subtract the sales tax rate from the item's price to find the total purchase price.
C
Add the sales tax rate to the item's price, then multiply by the item's price to get the total purchase price.
D
Multiply the item's price by the sales tax rate to find the sales tax, then add the sales tax to the item's price to get the total purchase price.
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1
Step 1: Understand the concept of sales tax. Sales tax is a percentage of the item's price that is added to the price to determine the total purchase price.
Step 2: To calculate the sales tax, multiply the item's price by the sales tax rate. For example, if the item's price is P and the sales tax rate is R, the formula for sales tax is:
Step 3: Once the sales tax is calculated, add it to the item's price to determine the total purchase price. The formula for total purchase price is:
Step 4: Ensure that the sales tax rate is expressed as a decimal when performing the calculation. For example, a 7% sales tax rate should be converted to 0.07 before multiplying.
Step 5: Verify your calculations by checking that the total purchase price is greater than the original item's price, as the sales tax is an additional cost.