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Difficulty: HardTaxes and Tips

A customer brings their vehicle in for repairs. The mechanic's itemized bill lists $200.00\$200.00 for labor and $120.00\$120.00 for parts. The customer uses a promotional code that provides a 15%15\% discount on the labor cost. A 5%5\% sales tax is applied only to the cost of the parts. If the customer adds a 20%20\% tip calculated on the original pre-discount labor cost, what is the total amount the customer pays?

  1. A
    $351.00\$351.00
  2. B
    $330.00\$330.00
  3. $336.00\$336.00Answer
  4. D
    $344.50\$344.50

Answer

The total amount the customer pays is $336.00\$336.00.
The total consists of four separate components: the discounted labor, the parts, the tax, and the tip. First, the discounted labor is $200−(0.15×$200)=$170\$200 - (0.15 \times \$200) = \$170. The parts remain at $120\$120. Second, the 5%5\% sales tax is applied only to the parts, resulting in an additional 0.05×$120=$60.05 \times \$120 = \$6. Finally, the 20%20\% tip is calculated strictly on the original $200\$200 labor cost, yielding $40\$40. Summing these amounts yields $170+$120+$6+$40=$336.00\$170 + \$120 + \$6 + \$40 = \$336.00.

Step-by-Step Solution

1
Calculate the discounted labor cost.
$170.00\$170.00
A 15%15\% discount on the $200.00\$200.00 labor cost is 0.15×200=300.15 \times 200 = 30. Subtracting this from the original cost gives $200−30=$170\$200 - 30 = \$170.
2
Calculate the sales tax on the parts.
$6.00\$6.00
The 5%5\% tax is only applied to the $120.00\$120.00 parts cost. 0.05×120=60.05 \times 120 = 6.
3
Calculate the tip based on the original labor cost.
$40.00\$40.00
The problem states the 20%20\% tip applies to the original pre-discount labor cost ($200.00\$200.00). 0.20×200=400.20 \times 200 = 40.
4
Sum all final costs to find the total amount paid.
$336.00\$336.00
Add the discounted labor, parts, tax on parts, and tip: $170+$120+$6+$40=$336.00\$170 + \$120 + \$6 + \$40 = \$336.00.

Key Concept

Calculating percentages on distinct bases in multi-step financial transactions.
Estimated Time:2m 0s
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Topics

Taxes and Tips

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