Calculation Summary
A discount calculator is a handy tool for figuring out exactly how much you will save during a sale and what your final out-of-pocket cost will be before you head to the checkout counter.
How to Calculate a Discount
Calculating a discount involves simple percentages. To find out how much you are saving, you multiply the original price by the discount percentage. Then, you subtract that saved amount from the original price to get your cost before tax.
The basic formulas are:
- Discount Amount = Original Price * (Discount Percentage / 100)
- Price Before Tax = Original Price - Discount Amount
- Tax Amount = Price Before Tax * (Tax Percentage / 100)
- Final Price = Price Before Tax + Tax Amount
Example: If a jacket costs $100 and is on sale for 20 percent off with a 5 percent sales tax:
- Discount Amount = 100 * 0.20 = $20
- Price Before Tax = 100 - 20 = $80
- Tax Amount = 80 * 0.05 = $4
- Final Price = 80 + 4 = $84
Notice that sales tax is calculated based on the discounted price, not the original price. This saves you even more money during a sale.
How to Use This Tool
- Enter the Original Price listed on the item's tag.
- Enter the Discount Percentage advertised by the store.
- Enter your local Sales Tax Percentage (if applicable).
- The calculator instantly updates to show your total savings, the tax added, and the final total you will pay.
Frequently Asked Questions
How do you calculate a double discount?
If a store offers "20 percent off, plus an additional 10 percent off at the register," you cannot just add them together to get 30 percent. You must calculate the first 20 percent discount, find the new price, and then apply the 10 percent discount to that new, lower price.