A service request item costs 65.00. The invoice adds 5% tax and applies a 10% discount to the pre-tax subtotal. What is the total amount due?

A service request item costs 65.00. The invoice adds 5% tax and applies a 10% discount to the pre-tax subtotal. What is the total amount due?

• A. 61.75
• B. 60.50
• C. 63.25
• D. 66.00

Answer: (A)

Think in terms of a single base amount and apply both the tax and the discount to that base, then combine. - Base amount (pre-tax subtotal): 65.00 - Tax on that base: 5% of 65.00 = 3.25 - Discount on that base: 10% of 65.00 = 6.50 Total due = base + tax − discount = 65.00 + 3.25 − 6.50 = 61.75 So the total amount due is 61.75.

Think in terms of a single base amount and apply both the tax and the discount to that base, then combine.

• Base amount (pre-tax subtotal): 65.00

• Tax on that base: 5% of 65.00 = 3.25

• Discount on that base: 10% of 65.00 = 6.50

Total due = base + tax − discount = 65.00 + 3.25 − 6.50 = 61.75

So the total amount due is 61.75.