Sales Tax and Discounts

Denise Folk                    Richard E. Byrd Academy
                               363 W. Hill
                               Chicago, ILL 60610
                               312-280-4000

Objectives:

The sixth through eighth grade students will be able to:
1. Discover that sales tax is an additional charge on products purchased.
2. Compute sales tax on different items using register tapes.
3. Discover that discount means to take a certain amount off the price of 
   something.
4. Discuss that even if you take the discount off the purchase price of an 
   item, you still have to pay sales tax.

Materials needed:

All materials listed are for an entire class.
1. Calculators
2. Various register receipts from different stores
3. Play money
4. Dice
5. Sales tax table
6. Practice worksheets on sales tax and discounts
7. Sample newspaper and catalog ads
8. Discount signs made up or signs discarded from retail stores

Recommended Strategy:

 1. Have students collect sales receipts from different retail and grocery 
    stores ahead of time for this lesson.
 2. Four students can pretend to gamble with dice and money to introduce the 
    lesson.
 3. Stop the game at any point you deem necessary and let the winner know that 
    even though he or she won there will be a tax on their winnings.
 4. From above activity you can elicit the definition of taxes from your 
    students.
 5. Use sample grocery store receipt duplicated on a poster board to illustrate 
    sales tax, coupons taken off, amount tendered, change.  Make sure they 
    understand that sales tax is an additional charge on purchases made imposed 
    by the government.
 6. Discuss the fact that there are different rates of sales tax for food and 
    nonfood items and also that the tax varies from state to state.
 7. Review how to change percents to decimals in order to multiply.
 8. Let students use calculators to compute totals from receipts brought in for 
    lesson.  Also, let them practice computing sales tax for each purchase.
 9. Students can also practice finding sales tax by using food sections of a 
    newspaper to shop for their family and then compute the sales tax to be 
    charged.
10. The day following this lesson you can introduce discount,define it and the 
    fact that it varies from the regular price.
11. Use catalogs, newspaper ads and any other materials that you find to 
    illustrate discounts.
12. After you go over with students the examples above you can give them 
    worksheets to provide practice with discounts.
13. Students can bring in different items to mark a price on and to practice 
    taking a percent off.
14. As a follow up to these lessons you can take the students to stores and let 
    them actually shop, compute the sales tax and also find the discount.