Calculate the original nightly cost before sales tax

What is the original nightly cost of an inn before sales tax is added if the total cost including an 8% tax is $122.04?

Choose one:

a. $113

b. $120

c. $125

Answer:

The original nightly cost of the inn before sales tax is added is $113.

To calculate the original nightly cost before sales tax is added, we need to reverse the percentage increase caused by the sales tax. The total cost including sales tax (which is 8%) is $122.04, and we want to find the original price before the tax.

Let's denote the original price as P. Since 8% sales tax is added to the original price, we can express the total cost as P + (0.08 × P) = 1.08P. Therefore, the equation to find the original price is:

1.08P = $122.04

To find P, divide both sides of the equation by 1.08:

P = $122.04 / 1.08

Upon calculation:

P = $113

So, the original nightly cost before tax is added is $113.