A grocery store receipt shows 5% state tax due on laundry detergent and a flower bouquet. Does it matter whether the tax is calculated on each separate item or the total cost? Explain.

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ButtersLeopoldStotch ButtersLeopoldStotch · Answer 1 · 2014-10-02T19:58:11-04:00

If the receipt shows both items it does matter, if you simply calculate each its like your putting 10% tax on it.

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chisnau chisnau · Answer 2 · 2019-05-24T11:33:07-04:00

It does not matter whether the tax is calculated on each separate item or the total cost.

Lets check both the conditions by taking 2 items.

Lets suppose a person buys laundry detergent for $4.50 and flower bouquet for $5.25

Condition 1: If 5% tax is deducted separately on both items:

Cost of laundry detergent becomes after tax = [tex]0.05\times4.50=0.225[/tex]

= [tex]4.50-0.225=4.275[/tex]

Cost of flower bouquet becomes = [tex]0.05\times5.25=0.2625[/tex]

= [tex]5.25-0.2625=4.9875[/tex]

So, total tax deducted is = [tex]0.225+0.2625[/tex]= $0.4875

Condition 2: If tax is deducted on whole amount.

Cost of both the items = [tex]4.50+5.25[/tex] =$9.75

5% tax on 9.75 is = [tex]0.05\times9.75[/tex] = $0.4875

Hence, we can see that in both the conditions the tax is same that is $0.4875

So, it does not matter whether the tax is calculated on each separate item or the total cost. The tax remains the same.