Question

Chris took a vacation trip to Maine, where sales tax on taxable items is 5%. In Maine, prepared food and lodging are taxed an additional 2%, for a total of 7% tax, while auto rentals are taxed an additional 5%, for a total of 10% tax.

Chris bought $70 worth of souvenirs, taxable at the general rate. He also spent $580 on prepared food and lodging and $620 for a rental car, all before tax. How much did he spend in total after tax was included?

A.$1333.50 
B.$1316.10 
C.$1270.00 
D.$1376.10

Answer 1

D.$1376.10

Explanation:

Tax paid by Chris on $70 worth of souvenirs =5% of 70=$3.5.

Cost of Souvenirs after tax= 70+3.5=$73.5.

Tax paid on prepares food and lodging = 2%+5%=7% of $580=$40.6.

Cost of food and lodging after taxes =580+40.6=$620.60.

Tax on rental car =10%of $620=$62.

Cost of rental car after taxes =620+62=$682.

Total amount spent by Chris= $73.5+$620.60+$682=$1376.10.

Option D.$1376.10.

Answer 2

Compute individual cost with tax, then sum all cost to get the total cost inclusive of tax.
total cost for souvenirs= $70(1+.05)=$73.5
total cost for food and lodging =$580(1+.07)=$620.6
total cost for car rental= $620(1+0.1)=$682
Total expenditure inclusive of tax= $73.5+$620.6+$682= $1376.10
Chris spends a total of D. $1376.10 in Maine.