Find the total cost

Question

A vacuum is priced at $404 with an allowed trade-in of $150 on an old unit. If sales tax of 6 3/4% is charged on the price of the new vacuum unit before the trade-in, find the total cost to the customer after receiving the trade-in.

Answer 1

ANSWER: The total cost to the customer is 281.27. Explanation follows.

 

The sales tax is calculated on the entire $404 of the new vacuum:

 

(6 3/4%)(404)=27.27

 

Then you subtract the 150 trade-in value from the $404 price of the new vacuum

 

404-150=254

 

Now, add 27.27 to 254 to get the total cost to the customer:

 

27.27+254=281.27