# Commission, Sales Tax, and Profit

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Commission, Sales Tax, and Profit
Unit 2, Lesson 3 Commission, Sales Tax, and Profit

Warm Up Estimate. 1. 20% of 602 out of 264 3. 151% of 78 out of 0.95 Possible answers: 120 50% 120 30%

A commission is a fee paid to a person who makes a sale
A commission is a fee paid to a person who makes a sale. It is usually a percent of the selling price. This percent is called the commission rate. commission rate  sales = commission

Class Example A real-estate agent is paid a monthly salary of \$900 plus commission. Last month he sold one condominium for \$65,000, earning a 4% commission on the sale. How much was his commission? What was his total pay last month? First find his commission. 4%  \$65,000 = c commission rate  sales = commission 0.04  65,000 = c Change the percent to a decimal. 2600 = c Solve for c.

Class Example: Continued
A real-estate agent is paid a monthly salary of \$900 plus commission. Last month he sold one condominium for \$65,000, earning a 4% commission on the sale. How much was his commission? What was his total pay last month? He earned a commission of \$2600 on the sale. Now find his total pay for last month. \$ \$900 = \$ commission + salary = total pay. His total pay for last month was \$3500.

First find her commission.
Practice Problem 1 A car sales agent is paid a monthly salary of \$700 plus commission. Last month she sold one sports car for \$50,000, earning a 5% commission on the sale. How much was her commission? What was her total pay last month? First find her commission. 5%  \$50,000 = c commission rate  sales = commission Hiding Slide 7 0.05  50,000 = c Change the percent to a decimal. 2500 = c Solve for c.

Practice Problem 1 (Continued)
A car sales agent is paid a monthly salary of \$700 plus commission. Last month she sold one sports car for \$50,000, earning a 5% commission on the sale. How much was her commission? What was her total pay last month? The agent earned a commission of \$2500 on the sale. Now find her total pay for last month. Hiding Slide 8 \$ \$700 = \$ commission + salary = total pay. Her total pay for last month was \$3200.

Sales tax is the tax on the sale of an item or service
Sales tax is the tax on the sale of an item or service. It is a percent of the purchase price and is collected by the seller.

Class Example If the sales tax rate is 6.75%, how much tax would Adrian pay if he bought two CDs at \$16.99 each and one DVD for \$36.29? CD: 2 at \$ \$33.98 DVD: 1 at \$ \$36.29 \$70.27 Total Price  = Write the tax rate as a decimal and multiply by the total price. Adrian would pay \$4.74 in sales tax.

\$45  2 = \$90 Find the total price for the hotel stay.
Practice Problem 2 Amy reserves a hotel room for \$45 per night. She stays for two nights and pays a sales tax of 13%. How much tax did she pay? \$45  2 = \$90 Find the total price for the hotel stay. \$90  0.13 = \$ Write the tax rate as a decimal and multiply by the total price. Hiding Slide 11 Amy spent \$11.70 on sales tax.

Practice Problem 3 Anna earns \$1500 monthly. Of that, \$ is withheld for Social Security and Medicare. What percent of Anna’s earnings are withheld for Social Security and Medicare? Think: What percent of \$1500 is \$114.75? 114.75 1500 n 100 = Set up a proportion. n  1500 = 100  Find the cross products. 1500n = 11, Simplify.

Practice Problem 3 Continued
Anna earns \$1500 monthly. Of that, \$ is withheld for Social Security and Medicare. What percent of Anna’s earnings are withheld for Social Security and Medicare? 11,475 1500 n = Divide both sides by 1500 n = 7.65 Simplify. 7.65% of Anna’s earnings is withheld for Social Security and Medicare.

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