This document provides instructions for calculating sales tax by converting the tax percentage to a decimal, multiplying the purchase price by that decimal, and rounding the result to the nearest cent. An example is shown of calculating the 6.75% sales tax on a $16.99 CD purchase. Readers are then prompted to calculate the 6.25% sales tax on a $24.50 shirt. The correct answer of $1.53 is provided along with an encouragement to practice. Finally, five additional practice problems are presented with their answers.

1. Calculating Sales Tax
Financial Management

2. To calculate sales tax:
• Change the percent to a decimal
example: 6.75% = .0675
(Remember to drop the % and move the decimal 2 places to the
left.)
• Multiply the purchase price by the decimal
• Round your answer to the nearest cent

3. Example
Sue buys a CD that costs $16.99
before sales tax. The sales tax is
6.75%. How much tax does Sue pay?
• Change 6.75% to a decimal (.0675)
• Multiply $16.99 times .0675 (1.147)
• Round to the nearest cent 1.15
• Sue will pay $1.15 sales tax.

4. Your turn!
Guillermo buys a shirt for $24.50.
The sales tax is 6.25%. How much
sales tax does Guillermo pay?
6.25% =
$24.50 x =
Sales tax is

5. Let’s see how you did!
= .0625
= 1.531
Guillermo paid $1.53 sales tax.
Good job!

6. Practice makes perfect!
Try these:
1. Tax is 5.35%, purchase is $453.22
2. Tax is 6.05%, purchase is $36.98
3. Tax is 6.75%, purchase is $121.03
4. Tax is 4.15%, purchase is $1003.48
5. Tax is 6.12%, purchase is $56.99
Answers: $24.25, $2.24, $8.17, $41.64, $3.49

7. Created by:
Genny Simpson
03/06/2013