A jewelry store in Lanberry bought a gold ring for $550 and marked it up 50% from the original cost. Later on, Beth purchased the gold ring and paid Lanberry sales tax of 8%. How much, including tax, did she pay for the gold ring?

Answer 1

To find out how much Beth paid for the gold ring, including tax, follow these steps:

1. Calculate the markup price of the ring:

   • The original cost of the gold ring is $550.
   • The markup is 50% of the original cost. \[ \text{Markup} = 0.50 \times 550 = 275 \]
   • Therefore, the selling price before tax is: \[ \text{Selling Price} = \text{Original Cost} + \text{Markup} = 550 + 275 = 825 \]

2. Calculate the sales tax on the selling price:

   • The sales tax rate is 8%. Calculate the tax: \[ \text{Sales Tax} = 0.08 \times 825 = 66 \]

3. Calculate the total price Beth paid including tax:

   • Add the sales tax to the selling price: \[ \text{Total Price} = \text{Selling Price} + \text{Sales Tax} = 825 + 66 = 891 \]

Thus, Beth paid a total of $891 for the gold ring, including tax.